Woman Behind ‘Flash Boys’ Exchange Approval Preps for Next Fight

Nobody at IEX Group Inc. had done more to prepare, amend and defend the company’s application to become a new kind of stock exchange than Sophia Lee, its general counsel. So when the U.S. Securities and Exchange Commission approved the move in a 122-page document delivered late on a Friday in June, Lee’s colleagues who lingered late to hear the news could read the regulator’s verdict in her look of triumph. (Bloomberg)

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Launch of ‘Flash Boys’ exchange IEX will test its philosophy

After all the regulatory hand-wringing, traded barbs, TV fights and the book, IEX will launch as a stock exchange beginning on Friday. It is a landmark moment for a trading start-up that has railed against the status quo of the world’s largest stock market. Backed by investors including mutual funds, hedge funds and venture capitalists, Investors Exchange now takes its place among the likes of the New York Stock Exchange and Nasdaq. (Financial Times)

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The Data-Driven Demise of the Flash Boys Myth

Recently, Reuters reported on a study by two professors at the University of California, Berkeley that, for the first time, presented data to test if the central claim of Flash Boys, and its protagonists IEX, was true. Namely, do high frequency trading strategies use information from fast data feeds to front-run investors who use slower data feeds? The answer is no. Or as one of the study’s authors put it more succinctly in the Reuters article, “that’s not happening.” (Modern Markets Initiative)

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Berkeley study finds scarce evidence of market ‘front-running’

Two University of California, Berkeley professors have taken a deep dive into new data and found that claims in Michael Lewis’ bestseller Flash Boys that retail investors are being gouged, or “front-run,” by high-speed traders not to be true – at least not now. Professors Robert Bartlett and Justin McCrary said their findings contradict the common belief that fast traders systematically exploit others who rely on public data feeds, which in the past were notoriously slow. (The Globe And Mail)

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