The Wall Street Journal – By Scott Patterson, Jacob Bunge, and Jenny Strasberg -        June 20, 2012

Duncan Niederauer of the NYSE/Bloomberg News

Conflict erupted among some of Wall Street’s heaviest hitters over a proposed definition of high-frequency trading, showing rifts that divide big investment firms from the high-octane companies that specialize in the electronic trading.

The dispute, at a government-sponsored hearing Wednesday, underlines the bitter debate over the role played by high-frequency trading in modern-day markets. It also shows the challenges regulators face in trying to police a rapidly evolving securities industry. Critics have blamed complex trading strategies and computer glitches for driving small investors out of the market.

Regulators and industry officials gathered to discuss the proposed 58-word definition of high-frequency trading, among other issues, at the headquarters of the Commodity Futures Trading Commission. Rapid-fire trading accounts for more than half all stock and futures trading, according to industry researchers.

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