While an investor's ability to simultaneously consider multiple markets to accommodate its orders was perceived to allow for more competitive pricing (lower transactions costs), it also led toaform of "_______________" whereby traders with relatively faster access to specific markets can use another trader's planned orders and move ahead of that order.
A) randomized algo
B) front running
C) circuit breaking
D) specialist surfing

Question

Quizplus · Accepted Answer

The practice described in the question is known as front-running. It involves using knowledge of another trader's planned order to place an order ahead of theirs, with the intention of profiting from the price movements that result from the transaction. This practice is considered unethical and can be illegal, depending on the circumstances. Therefore, the answer is B, front-running.

While an Investor's Ability to Simultaneously Consider Multiple Markets to Accommodate