Reading Order
Flash Boys Reading Order
Michael Lewis's Flash Boys: A Wall Street Revolt (2014) examines the world of high-frequency trading — the use of ultra-fast computers and fiber-optic cables to trade stocks in microseconds — and argues that it constitutes a systematic rigging of the stock market against ordinary investors, told through the story of the traders and technologists who discovered the problem and built an alternative exchange (IEX) to solve it.
Where to start
Flash Boys
Complete Flash Boys Book List
- 1Buy
Flash Boys
Michael Lewis·2014·The complete standalone book. Start here. - 2Buy
The Big Short
Michael Lewis·2010·Lewis's account of the 2008 financial crisis — the chronological predecessor to Flash Boys in his examination of Wall Street dysfunction. Read before Flash Boys for the full context of how markets fail. - 3Buy
Liar's Poker
Michael Lewis·1989·Lewis's debut memoir of his years as a bond salesman — the historical backstory to the Wall Street culture that Flash Boys and The Big Short critique.
Flash Boys — Frequently Asked Questions
What is high-frequency trading?
High-frequency trading (HFT) is the use of sophisticated algorithms and ultra-fast computer networks to trade financial securities at extremely high speeds — thousands or millions of times per second — exploiting tiny price discrepancies across different exchanges that exist for fractions of a second. Practitioners co-locate their servers directly in exchange data centers and pay for fiber-optic cables that route data along the most direct possible path to gain microseconds of speed advantage. Lewis's argument in Flash Boys is that these speed advantages allow high-frequency traders to see other investors' orders and trade ahead of them ('front-running'), extracting value from ordinary investors without providing any economic benefit.
What is IEX and how does it address the problem?
IEX (Investors Exchange) was founded in 2013 by Brad Katsuyama and his team — the protagonists of Flash Boys — specifically to address the front-running problem. IEX introduced a 'speed bump' — a 350-microsecond delay (achieved by coiling 38 miles of fiber-optic cable) that slows all incoming orders equally, eliminating the advantage of co-location and speed that HFT relies on. The exchange gained Securities and Exchange Commission approval as a national securities exchange in 2016, over fierce opposition from Wall Street firms and existing exchanges.
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