Front-running is the illegal practice of trading ahead of a known large order to profit from the price move it will cause — a breach of duty and market fairness. It’s prohibited.

How it works

Someone with advance knowledge of a large pending order (say a broker who sees a client’s big buy about to hit) trades ahead of it — buying first, then profiting as the large order pushes price up. They exploit non-public knowledge of order flow for guaranteed-ish profit at others’ expense. It’s an abuse of a privileged position (like a broker’s duty to clients).

Why it's illegal

Front-running breaches trust and fairness — it uses privileged information about order flow to profit at the expense of the party whose order it is, and it undermines confidence in fair execution. It’s prohibited and prosecuted. (Note: some debate labels certain fast order-flow practices “front-running,” but true illegal front-running requires misusing knowledge of specific pending orders.)

Front-running is profiting from an order you know is coming — cutting the line with privileged knowledge. It’s illegal because it robs the very order it rides.

The takeaway

Front-running is illegally trading ahead of known orders using privileged information — a fairness/duty violation. It’s market-structure literacy that rounds out the manipulation family with spoofing and wash trading. Understanding these keeps you clear-eyed about market fairness — and NoVo simply trades public dealer structure.