Why is Front Running markets not treated as insider trading?
<p>Front-Running is described in the book Flashboys and relies on an information advantage, that is apparently provided by the exchanges to a select few.  </p>

<p>Is said practice somehow different from insider trading?</p>

<h2>It’s not insider trading</h2>

<p>Insider trading refers to leveraging private information that you only know because of your “insider” position.</p>

<p>Front running is using information that is publicly available, albeit for a fee. Buying information that anyone <em>can</em> buy is not insider trading.</p>

<p>The term &quot;insider trading&quot; is generally used to refer to when someone trades on information from the company whose stock they are trading. &quot;Front running&quot; is generally used to refer to when someone is acting as an agent on behalf of a client trying to buy stock, and uses information that the client gives them about what stocks they want to buy to buy that stock for themselves. For instance, if a someone places an order large enough to move the market with their broker, the broker may first buy the stock, then send their client's order through, then sell their own stock, now at a higher price. So in both cases, someone is misusing information that they were entrusted with, but the source of that information differs.</p>

finance securities sec insider-trading