June 2020

Posted by Anton Murray Consulting on . Posted in 2020

Lewis is a good example of carving a unique path; starting out as a grad fixed income salesman at Salomon Brothers, and transitioning to a career writer with his first novel Liar’s Poker. Lewis also continued with notable works The Big Short and Moneyball, both made into blockbuster films.

Flash Boys, published in 2014, tells the murky story of high-frequency trading and its influence on the numerous public and private exchanges that make up the US listed stock market. It is not so much an exposé, as an account of a couple of ex-traders, developers and technology sales people coming together to try to rewire a trading and market environment that they thought was fundamentally broken.

The story follows a former trader and banking executive Brad Katsuyama who, with some colleagues and a band of diverse personnel, start an alternative stock exchange, the IEX. Their fundamental goal was to remove unfairness from the market and support the underlying needs of actual investors who were at the wrong end of front running and other predatory strategies executed by high-frequency traders. The situation is heightened by the understanding that the high-frequency traders, the investment banks and exchanges themselves are all in on the investor predation together.

The protagonists in Flash Boys took a huge gamble to leave high-paying, good quality jobs to pursue a path that certainly did not hold any guarantee of success. Lewis himself is a good example of a person changing career paths to great personal satisfaction and, of course, commercial success. Much like the characters in Flash Boys, Lewis’ own departure from financial services has the moral undertones that Katsuyama and his colleague’s had in creating IEX to challenge the status quo on Wall Street.

Flash Boys is more about having the fortitude to make change than it is about the seductive power of Wall Street and high-frequency trading. It is a valuable lesson to acknowledge that there is always something better, and it is not always best to do things the way they have always been done. This realisation and commitment to action is hard but it is worthwhile; both Lewis and the IEX team are proof of that.

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