Market volatility and crashes in experimental financial markets with interactions between human subjects and algorithmic traders. Jacob Leal, S. paper-progress.
abstract   bibtex   
We investigate via experiments in the lab the effect of different high frequency trading strategies on the behaviour of human traders and the consequent effect on market volatility and the emergence of flash crashes. In the experiments we compare the effects of two types of HFT strategies: a) a market-making strategy, aiming to improve liquidity in the market, b) a spoofing stragy aimed to manipulate prices on the market. The goal is to understand the response of humans to different HF traders behavior and in this way get insights to design more effective policies to improve market stability
@article{
 title = {Market volatility and crashes in experimental financial markets with interactions between human subjects and algorithmic traders},
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 created = {2016-11-01T17:28:22.000Z},
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 last_modified = {2017-03-14T12:29:36.496Z},
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 abstract = {We investigate via experiments in the lab the effect of different high frequency trading strategies on the behaviour of human traders and the consequent effect on market volatility and the emergence of flash crashes. In the experiments we compare the effects of two types of HFT strategies: a) a market-making strategy, aiming to improve liquidity in the market, b) a spoofing stragy aimed to manipulate prices on the market. The goal is to understand the response of humans to different HF traders behavior and in this way get insights to design more effective policies to improve market stability},
 bibtype = {article},
 author = {Jacob Leal, Sandrine},
 journal = {paper-progress}
}
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