Most exchanges that trade "arbitragable" instruments are in the same timezone and geographic location (NY-Chicago is one exception). There is no point having the optimal colo between TSE and NYSE because they have no overlapping hours nor do they have anything that trades on both and is fungible.
This research is patently academic. This is what happens when two pointy heads in ivory tower with zero empirical trading experience dream up something. Then all geeks go ga-ga talking about fiber optics and sea steading and other bs.
"There is no point having the optimal colo between TSE and NYSE because they have no overlapping hours nor do they have anything that trades on both and is fungible."
There is tremendous overlap amongst various stock exchanges, OTC's, dark pools (12% of US trading), and of course there's Forex which is 24/7.
This research is patently academic. This is what happens when two pointy heads in ivory tower with zero empirical trading experience dream up something. Then all geeks go ga-ga talking about fiber optics and sea steading and other bs.