I'm not a fan of high frequency traders and, most particularly the pattern day trader rule which limits HFT to those with accounts worth over $25,000. The excuse is that HFT is too risky for the average investor. The reality is that short-term profit taking is far less risky than the "buy and hold" strategy sold to the average investor. And the government STILL collects a tax of roughly a penny per every $400 in stock sold, which is MORE than adequate to regulate Wall Street.
That being said, a bigger tax will do little to reduce high frequency traders because most of it is done by investment banks like Goldman Sachs, not some retired schmuck who wants to make a little more on an account typically worth between $25K and $100K who can least afford the tax. But I guess that's the whole idea.
I am not understanding your position.
It would seem to me that small traders would hold the stock for longer periods of time. Whether that is for a full day, a full week or a full year...it doesn’t matter. The longer you hold and the fewer trades you make, the less you are impacted by the transaction tax.
I would imagine that Goldman Sachs, would have a much higher turnover volume and much shorter hold times than a smaller investor.
Can you explain why you think the proposed transaction tax would affect GS less than a small guy?