Randomisation allows smaller players to compete

Larry Harris says randomisation will make markets more competitive


Randomisation makes it significantly easier for smaller players to compete in liquidity provision and it will lead to more competition while removing the incentive to focus solely on speed, says Larry Harris, a former chief economist of the Securities and Exchange Commission and now professor of finance at the USC Marshall School of Business in California.

Harris has been a long-term advocate of small, 1–10 millisecond, randomised pauses in the fight against harmful high-frequency trading (HFT)