Nabicht: “Professional Traders, HFT Technology and the Value Provided to Investors”

In a commentary for The Hill, Modern Markets Initiative (MMI) senior advisor Peter Nabicht explains how investments in automation technology have transformed the old, closed trading floor model into a marketplace that is more transparent and accessible than ever before for today’s average investor.

“As lawmakers continue to hold hearings on Capitol Hill,” writes Nabicht, “they should be aware that our financial markets have always had professional traders who worked as intermediaries, ensuring customers could find a good price when they needed to trade.”

According to Nabicht, thanks to advances in telecom and computer technology, “information about what orders were in the market was no longer limited to just the traders occupying the floor of the exchange. Now, anyone who invested in a data line and a computer could see all the details of what orders were in the market.”

Today’s modern markets are not perfect, acknowledges Nabicht, but “as we confront the challenges and opportunities that modern technologies offer to financial markets, we need to remember that the new market structures and high frequency trading have produced efficient markets that provide fair prices to investors.”

Read Peter Nabicht’s full commentary on TheHill.com here.