Why is illegal front running allowed on the ASX?
Project : Front Running is supposed to be illegal on Australian stock exchanges (ASX) as it means trading bots are given access to submitted broker client orders before execution and can selectively jump ahead to capture profits at the client's expense. The ASX, ASIC and relevant law are supposed to prevent front running "if trading ahead of client orders disadvantages clients." Yet, this is exactly what currently occurs on the ASX with the CBOE Australia (formerly Chi-X) exchange used by High Frequency Trading bots to mine front running profits. Presumably, the ASX is paid to facilitate this. ASIC appears to suffer from regulatory capture and could easily ban this but so far hasn't. Impact : Apparently, ~20% of daily trade volume is on the CBOE, so I estimate the annual loss to Australians is hundreds of millions of dollars a year. Mission : Investigate the scale of the annual profit extraction and who is being paid off to enable this. > Simple Explanation of Fr...