For the launch of the Avis on High Frequency Trading by the Commission de l’Éthique en Science et en Technologie, Bernard Sinclair-Desgagné, holder of the Chair in Environmental Economics and Global Governance at HEC Montréal and Fellow at CIRANO, prsented a paper entitled the "High Frequency Trading – An Ethical Perspective of a New Technoscience".
The discipline and practice of Finance are now largely grounded in science and technology. As such, Finance falls within the scope of the Commission de l’Éthique en Science et en Technologie (CEST) du Québec, which mission is precisely to launch and support reflections and public debates on the ethical issues raised by the development of science and technology.
High Frequency Trading (HFT) – i.e. the implementation of automatized, high-speed, trading strategies – is a paramount example of Finance being now a “technoscience”. Its importance is large and growing. Supporters claim it improves the quality of financial markets. Critics say the opposite. For sure, HFT also raises ethical issues having to do with integrity, equity, social welfare, etc. Hence, the CEST chose to reflect and write an Avis on the subject, the objective being to support financial regulation when it is relevant, and to complement it when it seems to have little grasp on the involved parties.
This short presentation summarized the main points of the CEST’s Avis. It first described what HFT is – its nature, stakeholders, technological infrastructure, implemented strategies, and development factors. It then considered its impacts and the related ethical issues. It finally conveyed the reflections and recommendations of the CEST.