This article is part of a series that was originally published on the Tabb Forum at http://tabbforum.com/opinions/why-hfts-have-an-advantage-part-4-winner-take-all-the-day-iso and is reproduced here with the author's permission.
 
Perhaps the most powerful order type in the HFT arsenal, the DAY ISO is the only order type that can light a new aggressive price on an exchange that locks an away market, providing an end-around to Rule 610 and the ban on locked markets and...

This article is part of a series that was originally published on the Tabb Forum at http://tabbforum.com/opinions/why-hfts-have-an-advantage-part-3-intermarket-sweep-orders and is reproduced here with the author's permission.
 
Though ISOs were meant for large institutions sweeping through the book, an unanticipated consequence has been that HFTs leverage the order type to get ahead of slow SIP data feeds on price moves. Brokers that don’t use ISOs in fast...

This article is part of a series that was originally published on the Tabb Forum at http://tabbforum.com/opinions/locked-markets-priority-and-why-hfts-have-an-advantage-part-2-hide-and-light and is reproduced here with the author's permission.

Part 2: Hide & Light
As high-frequency trading (HFT) scalping strategies began employing “spam and cancel” strategies that dominated top-of-book trading activity (see: Locked Markets, Priority and Why HFTs...

This article is part of a series that was originally published on the Tabb Forum at http://tabbforum.com/opinions/locked-markets-priority-and-why-hfts-have-an-advantage-part-i and is reproduced here with the author's permission.
 
Part I: Spam and Cancel
In 2005, Regulation NMS was adopted to bind U.S. equity markets into a unified national market. REG NMS was implemented market-wide in 2007, a year particularly notable as an inflection point for the rapid growth of...