High frequency trading is the best thing in the history of the world, barring nothing. Let us recall that there are two parties to a trade, and that the trading is voluntary and is only done when thought by both parties to be in their respective interest. Doing such a thing at a high frequency, then, must be more of a good thing, and more is better.
I think that high-frequency trading is just a logical progression of our technology being used in financial markets, I think high-frequency trading needs to be regulated to an extent that prevents a mistake from costing trillions of dollars, I think that overall high-frequency trading adds liquidity to the marketplace and is overall a good thing.
High-frequency trading is not good. Advocates of HFT have argued that this kind of trading is good because it cuts down transaction times and cost, and pretty much ensures that any retail or institutional investor can find someone to take the other end of their trade. However, It’s great for those who practice HFT, but it reduces profits to everyone else, because in those few milliseconds before the NBBO is calculated and disseminated, the high-frequency traders carry out deals at a price that favors them.
High-frequency trading is extremely risky, with the possibility of mistakes being compounded quickly. Because high-frequency trading relies on speed to make money, safeguards are often overlooked in the interest of increased efficiency. In addition, some firms pay a fee to be able to receive market data slightly faster than the general public (typically less than a second faster), and this gives an unfair advantage that is only made possible by high-frequency trading.