Once one understands the disadvantage of being at the bottom of the stack, it becomes much easier to understand the importance of speed in HFT. As new price levels form, HFTs compete with other HFTs to join the new price as quickly as possible in order to secure advantageous stack position for passive orders.
Arzhang Kamarei — Once one understands the disadvantage of being at the bottom
Once one understands the disadvantage of being at the bottom of the stack, it becomes much easier to understand the importance of speed in HFT. As new price levels form, HFTs compete with other HFTs to join the new price…