I think that an exchange that places less of a premium on speed like the IEX is an way to evaluate claims that HFT is hurting markets. Let the market evaluate by providing different options to investors. If HFT is providing benefits in terms of cost or liquidity then IEX will fail as it is not providing those benefits. I'm all for providing options to investors and letting them vote with their dollars about which exchange they like best. If HFT is truly providing value then they should welcome some competition to show how much value they are adding.
Except the buyers and sellers (mutual funds, etc) aren't the brokers, and brokers ultimately decide where to send the orders. I don't believe there is any regulation that forces a broker to use an exchange the customer specifies; rather, that they must buy or sell on the exchange that provides the best price.
Is there any transparency or accountability for this? Eg, does the broker have to give the client a report of trades and the exchanges they were sent to?
