Flash Boys

flash boys cover image Flash Boys

by Michael Lewis
W. W. Norton & Company
Hardcover, 288 pages

Imagine if you had electronic gear on which a share of stock could experience about 500 quote changes and about 150 trades in a millisecond – that’s one 1000th of a second!  A really quick blink of an eye takes a leisurely 100 milliseconds. Well, you could probably make a little money! Wall Street’s so-called “high-frequency traders” did just that – in the billions of dollars a year at a fraction of a penny at a time. As with most of the rest of Wall Street these days they did it not to channel capital to productive enterprise, but rather to line their pockets and burnish the machismo of their arrested development. Michael Lewis’ fascinating story of how a group of “rogue” Wall Street good guys out-gamed the gamers is as exciting as the best whodunit. They uncovered the predatory strategies – especially electronic front-running, rebate arbitrage, and slow-market arbitrage – and blocked each one. Oddly enough, they did it by slowing things down! Not being entirely selfless do-gooders, they have created their own transparent exchange – IEX – and have already left exchanges like AMEX in the dust. Great story, great characters!