If we put aside for a second the overall sleaziness of this industry that makes working for it very unattractive, isn't HFT at a dead end? Do people still make a lot of money off it? Hasn't it reached the tail-end of diminishing returns?
If on the other hand, you are talking about other forms of algorithmic trading, there is still money to be made by being smart, having insight, having better procedures, or faster time to market etc. The arms race in latency arbitrage has actually made a lot of this easier as it has dramatically brought down the cost of entry to the non-bleeding edge of latency use cases.
Other than algorithmic speculation (sentiment analysis, etc), is it still possible to come up with better (non-speculative) procedures that yield substantial profit?
http://www.businessweek.com/articles/2013-06-06/how-the-robo...