Does Co-location Scam Really Exist? A Review of National Stock Exchange Co-location Scam
Does Co-location Scam Really Exist? A Review of National Stock Exchange Co-location Scam

Summary/Abstract: The present paper provides the comprehensive review of co-location facility and related technical glitch or scam at National Stock Exchange (NSE). The previous technological advancements such as algorithmic trading (AT) and high-frequency trading (HFT) contributes the market positively by controlling volatility and as liquidity provider. Particularly, Algorithmic trading has been praised for providing liquidity and controlling volatility, particularly for retail traders. However, some argue that it harms both small and institutional traders and the market's order. This article analyses the influence of co-location on the major characteristics affecting market quality: Price discovery, liquidity, transaction costs, volatility, and punishing slower traders. The findings of the paper suggest that co-location is not a scam it is a glitch of servers which has given loopholes to the institutional traders and ultra-speed of information flow.

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