So I was reading an interview in zerohedge the other day and this caught my eye... http://www.zerohedge.com/news/interview-high-frequency-trader A second example: HFTs can model other tradersâ behavior. When someone trades through Scottrade or Interactive Brokers, their order has a unique number attached to it â the same number every time a client places an order. This number is bundled with all relevant trade information (time, price, etc.) and sold as an encrypted âenhanced data feed.â An HFT can then use those past results to predict the traderâs behavior. TCR: So HFTs try to predict what youâre going to do before you do it. Do the brokers admit to selling this information? Can traders opt out? GARRETT: This data is standard and available to anyone who wants to buy it, so itâs not that HFTs are purchasing illegal information. But the data set is huge and is only of practical use to players with very fast and powerful computers â meaning HFTs. And yes, most brokers I have encountered will allow you to opt out of having your unique number attached to your information. To be clear, Iâm not saying HFTs track your individual account and literally jump in front of you right before you trade. But they do use this information on the aggregate to model tradersâ behavior. So an HFT could have a very good idea of when traders on, say, E*TRADEâs book will enter into a certain transaction. This is the first I've ever heard of this. I have done a bit of google searching and have failed to gather any additional mentions of this sort of behavior. So is this actually happening? If so, it really ought to be illegal (especially if it's in real time). Aside from compromising the integrity of the markets, this would just add fuel to the fire of the increasingly prevalent populist sentiment that seems eager to implement reactionary anti-market policies such as transaction taxes.