Study – Taxing High Frequency Market Making: Who Pays the Bill?

Study – Taxing High Frequency Market Making: Who Pays the Bill?
Professors Katya Malinova, Andreas Park and Ryan Riordan analyze the effect of a message fee imposed on the Canadian stock markets.  It was designed to target high frequency trading to ensure that they pay their fair share of the regulatory surveillance costs of the Investment Industry Regulatory Organization of Canada.  Yet ultimately, all investors faced worse market conditions and thus, arguably, paid the “tax.”