Chuckie objects to illegal front running – when a broker dealer gets a large customer order and then trades for its own account ahead of the order because it knows the order is large enough to drive the market price. That has nothing to do with flashes.

Flash orders are limit orders – so, Chuckie’s assertion that they would be done at a better price by being sent to the floor as one order is bogus. In fact, the opposite is true. If the market sees a giant bid sitting on the books, not only will market makers bid smaller in front of it, but they will also raise their offers. Depending on how liquid the security is, the customer can drive the price way up by doing that.

Flashes are seen by all the membership of the exchange and we have the option to provide liquidity at that price or not – but only for a second. The customer doesn’t want his order sitting on the book so that market makers can lean all over him. I don’t see the problem with that. Trading is like poker. Every order carries information to the other players. From the customer’s perspective the less information he gives the market, the more advantage he retains.