The other key ingredient to the success of any HFT platform is low network latency. The platforms are greatly helped in this regard by the fact that many exchanges will let HFT platforms pay to co-locate their servers with those of the exchange itself, so that the HFT platform can get its order in ahead of the competition. Critics contend that such co-location deals provide avenues for potential front-running of orders, in which an HFT platform gets an advance peek at an incoming order that will move a stock’s price in a specific direction, and then uses that knowledge to make a quick bet on the impending price move.
via The Matrix, but with money: the world of high-speed trading
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