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From decision optimization to satisficing: Regulation of automated trading in the US financial markets

Author

Listed:
  • Wendy L Currie

    (Audencia Business School)

  • Jonathan J J M Seddon

    (Audencia Business School)

  • Ben van Vliet

    (Stuart School of Business - IIT - Illinois Institute of Technology)

Abstract

This is a PDF file of an article that has undergone enhancements after acceptance, such as the addition of a cover page and metadata, and formatting for readability, but it is not yet the definitive version of record. This version will undergo additional copyediting, typesetting and review before it is published in its final form, but we are providing this version to give early visibility of the article. Please note that, during the production process, errors may be discovered which could affect the content, and all legal disclaimers that apply to the journal pertain.

Suggested Citation

  • Wendy L Currie & Jonathan J J M Seddon & Ben van Vliet, 2022. "From decision optimization to satisficing: Regulation of automated trading in the US financial markets," Post-Print hal-03839100, HAL.
    • Handle: RePEc:hal:journl:hal-03839100
    DOI: 10.1016/j.im.2022.103721
    Note: View the original document on HAL open archive server: https://hal.science/hal-03839100
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    References listed on IDEAS

    as
    1. Kwan, Amy & Masulis, Ronald & McInish, Thomas H., 2015. "Trading rules, competition for order flow and market fragmentation," Journal of Financial Economics, Elsevier, vol. 115(2), pages 330-348.
    2. Andrew W. Lo, 2009. "Regulatory reform in the wake of the financial crisis of 2007‐2008," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 1(1), pages 4-43, April.
    3. Hendershott, Terrence & Riordan, Ryan, 2013. "Algorithmic Trading and the Market for Liquidity," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 48(4), pages 1001-1024, August.
    4. Christian Hugo Hoffmann, 2017. "Towards Understanding Dynamic Complexity in Financial Systems Structure-based Explanatory Modelling of Risks," Systems Research and Behavioral Science, Wiley Blackwell, vol. 34(6), pages 728-745, November.
    5. O'Hara, Maureen & Ye, Mao, 2011. "Is market fragmentation harming market quality?," Journal of Financial Economics, Elsevier, vol. 100(3), pages 459-474, June.
    6. Etti G Baranoff & Thomas W Sager, 2009. "The Impact of Mortgage-Backed Securities on Capital Requirements of Life Insurers in the Financial Crisis of 2007–2008," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 34(1), pages 100-118, January.
    7. Andrew Kumiega & Thaddeus Neururer & Ben Van Vliet, 2014. "Trading system capability," Quantitative Finance, Taylor & Francis Journals, vol. 14(3), pages 383-392, March.
    8. Stijn Claessens, 2019. "Fragmentation in global financial markets: good or bad for financial stability?," BIS Working Papers 815, Bank for International Settlements.
    9. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 69(1), pages 99-118.
    10. John Conlisk, 1996. "Why Bounded Rationality?," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 669-700, June.
    11. Herbert A. Simon, 1991. "Bounded Rationality and Organizational Learning," Organization Science, INFORMS, vol. 2(1), pages 125-134, February.
    12. Cooper, Ricky & Ong, Michael & Van Vliet, Ben, 2015. "Multi-scale capability: A better approach to performance measurement for algorithmic trading," Algorithmic Finance, IOS Press, vol. 4(1-2), pages 53-68.
    13. Van Vliet, Ben, 2017. "Capability satisficing in high frequency trading," Research in International Business and Finance, Elsevier, vol. 42(C), pages 509-521.
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