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More Free Publicity For Irene Aldridge As Jon Stewart Blasts HFT
The Cash Cow takes on the other cash cow. And for some reason, Irene Aldridge does not pimp her book.
| The Daily Show With Jon Stewart | Mon - Thurs 11p / 10c | |||
| Cash Cow - High-Frequency Trading | ||||
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When done watching, read this article by Sal Arnuk and Joe Saluzzi, posted in the bastion of HFT defense, AdvancedTrading.com.
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Fantastic! They really simplified what HFT is for the layperson and made Irene look like a fool.
There was no "making", they just let her be herself. Stupid is as stupid does.
That is fantastic. I would like to have Jon stewart run the SEC and maybe even come over for Thanksgiving, but I heard Hussein Obama was going to cancel that holiday and replace it with Indoctrination Day. It would be sort of a reverse holiday where we all have to go to our local stadiums and listen to him speak on the jumbotron. I live in Chicago so I am hoping I get a really good seat. Oh boy, I can hardly wait, I love these family events.
Unless you've referred to George W. Bush as "Walker Bush", you sound like a FOX viewer.
I'm starting to think we need a ZH posting filter to zap all anonymous posts that use the words 'Bush' or 'Obama'...
Newsflash: There ain't a thin post '64 dime's difference between the two of them.
It's Easy To Stop Political Content
Have Marla enforce the rules:
"A woman could cut off your penis while you're sleeping and toss it out the window of a moving car."
Obummer = George Bush in Black Face
So I am around your Obama filter already.
CLB = Bush
For the Bush filter, I use CLB = Bush... since Edu policy is often referred to as Bush's NCLB... I think it is ironic NCLB was promoted by the Child that WAS Left Behind...
Dime's Worth of Difference
Otherwise I agree with your lifting of Alex Cockburn's "Dime's Worth of Difference" c. 2006. Obummer is a Wall Street puppet and corporate stooge... He is a wildly successful president on those terms...
Every move Obummer has made since day one has benefited Wall Street and screwed the Amerikan public.
Let us see if the public will take more of the same by voting in more two (same) party hacks... Or if the public has eaten a big enough shit sandwich yet...
u forgot ACORN.
They missed out the most important part, where that "profit" actually comes from; everyone else
I'm sorry - but where is profit supposed to come from if not from someone else?
The efficiency of the system and price discovery happens only because everyone is attempting to make a profit from the rest of the market.
Unless you are a neutral market maker (and as Tyler pointed out yesterday, that does not exist in great abundance, and I would argue never really did), or are running part of the infrastructure (broker, exchange/ECN/ATF, lender, data center, data provider, bandwidth, news), your goal is to make money at the expense of other market participants.
isnt turning a profit the point of buying and selling securities? I really really thought that was the case...the further an equity is from its publicly perceived value(assuming no manipulation) the more opportunity for arb --> HFT is latency arb ---> There are a more and more people HFT ---> There are less and less arb opportunities ----> The market is becoming more efficient ---> s on my d
Hell, let's just give them all the money. It would speed things up.
Stewart is awesome. Just awesome.
IMO he's a little late to the party, but better late than never.
I get Ole'd (like a bull going by a bullfighter) every time I hit market buy or sell for more than a 2000 shares. I also get 15-20 different fills at different prices. It's a joke and hurts like hell.
Every trade you make should be a limit trade. But Keep your limits on the low side, because these bots will hit your limit every single F*ing time.
My experience is that even when I try to lift a best offer or hit a best bid (all at a limit price equivalent to the BBBO)---and the size shown is far larger than my order size---I still often get filled in a cascade of twenty or thirty piecemeal fills. One time I might think I just reacted too late; every time makes it a trend.
I hate those f*cking latency arb programs. NBBO can show 5x your limit size aggregated from 6 different destinations. If your default route happens to be the a destination with 100 shares showing on the inside You'll get filled on 100 shares and somehow the other destinations cxl or gets lifted when you were the one to have initiated. Then your lvs qty is 10 cents away from the inside in less than 500 ms. You are right. Once or twice I may have been slow, 95% of the time is a trend.
The speed of the market brings higher liquidity, but also faster px changes. Market orders are CRAZY in illiquid symbols.
Just a quick query. Does ANYONE on here actually make money day trading on an Ameritrade(or other similar high latency) platform? I mean everyone knows with fees as high as individuals pay that intraday "signals" are a bunch of hogwash.
Ways to make money in the market:
Charge customers, latency arb (becoming less and less available due to more HFT = more efficient market), or being a market maker...everything else is LUCK or manipulation.
I can make money performing stat arb with latency as high as 150ms measured from tick to my order hitting an exchange... but have not been able to consistenty make money with latencies higher than that.
I believe that would rule out Ameritrade and their brethren.
Probably the slowest mainstream broker that is remotely close to sufficient is Interactive Brokers, however their all in 1/2 penny per share pricing only applies to smart routed orders, which do a good job of sourcing liquidity - but add some additional latency.
If you can prove your arb, you can get funding. Use it, go co-lo, reap the benefits, while helping make the market more efficient. It's fun
....no.
You sound like you think you know all the answers, but you don't. Believe it or not there are ways to make money in the market that do not involve any of those things. Latency arbitration is not really all that different from regular arbitration, which is the essence of trading, you are trying to see isconnects in prices and other things that you can take advantage of. Both involve luck to a certain degree (yes lat arb involves luck, but it is hidden) but so do a lot of other things. The point is that a proper market functions in order to find the best price with the information available. This information should be the total information available. HFT creates a dynamic where all information available is moot (because 70% of all trades take place indepenent of any information other than bids and offers) and that price becomes the only relevant thing. By doing so it eliminated proper price discovery, the very purpose that the market should be there in the first place.
wtf is latency arbitration? I would think a guilty party of some crime would LOVE this!!!
Anyway. Latency arbitrage is becoming less and profitable, because more and more people are doing it. This doesn't make it "moot." It means the market is more efficient. The less arb opportunities available the more efficient the market. It's common sense really.
I didnt say arb was moot. I was saying that when the goal of 70% of the trades executed on the market is to arbitrage price information then that takes away from the efficiency of the market, because it makes the non bid/offer information available to the market effectively moot. Another way to put it is that ironically, a higher presence of machines makes the market trade more "on emotion" rather than acting on all the relevant information.
When most trades do not utilize all the available information presented to the market then that detracts from the efficiency of the market.
And arbitrage is a very complicated thing, but there are certain types of arbitrage opportunities which are only growing because of HFT. For example the arbitrage between indicators of solvency of a company (or system for that matter) and its stock price. Or to simplify this even further, the arbitrage opprotunity between companies earnings an the price one would pay for those earnings, is higher, thanks to HFT.
At at least one of my brokers, even stop-limit is crazy on illiquid symbols, since you can get triggered by a sudden (and short-lived) drop in bid, even if zero shares trade at that price.
Yes, indeed rhinotrader. It is important to note that it is your FDIC commingled and fungible money that JPM and GS are employing as FHCs to f*&up your fills while scarfing a few cents per second and paying zero interest in the bargain.
Stewart and team's comedy is brilliant.
Samantha Bee is absolutely hysterical in all of her skits.....this one was excellent.
Loved the utter caressing while moaning "hot, hot, hot"
GS and JPM like to think of it as, "taxing that ass." Yeehaw.
Always limit, The few times i have had to hit mkt, you get splattered. Futures and options are becoming the same way.
HFT, fun for everyone. Get Grandma involved, do it part time at home, during your lunch break, when ever and where ever you please.
Just call 1-You-R A C-hump and we'll get you started today. Only $29.95 per minute.
WOW!!! heavy shit; i think Irene actually read my comment about her sounding like a Moldavian potato farmer and decided to do something about it; she sounds more like a russian madame from Grozni ... nice phonetics job Irene; or should i say madame Irena ...
i'm wondering if she wants to marry you cheeky?
" .... you cant turn a ho into a housewife .... " 2pac shakur
but can you turn a hosuewife into a ho?I need to know.
there are rumors that the evidence for confirmation exists ... notable example; Donald Trumps wives ( all of them ) + naughtyathome web site ...
I'll take Tool Time for 200 Alex.
http://www.youtube.com/watch?v=QoMspJqqVcA
She's an electrical engineer so you know she's totally rocking an electromechancal husband.
funny shit CB, i was thinking about that post as i was watching. did you notice the intense concentration on her face as she stayed in character of a russian madame. than again it could have been constipation.
"Its nothing more than your average computer application, like your email."
Ohhhh thanks for explaining it Irene, now I get it.
I'm not a computer programmer, but that seemed like a pretty stupid comparison.
My first successful stat arb application was 8K lines of software.
Not the easiest 8K lines to write, and certainly heavier on math than an e-mail application - but it isn't an absurd comparison.
It's certianly easier to write a stat arb application than it is to write a game.
The software can get incredibly complex as you try to reduce latency and start looking at a broader and broader view of the market (i.e. moving from level 1 quotes to full depth and even harder to try to capture the options market) - but to perform the type of statistical arbitrage that Irene discusses (correlated pair trading) is not beyond the capabilities of a good software engineer who understands fundamentals of the equity markets... and contrary to the nonsense often posted here about the expense of "super computers", a sufficient server to execute most stategies will cost under $10K USD - and I've gotten away with as little as a single processor desktop HP that cost under $1K.
Appreciate the insight.
FWIW, the lines of code in Mozilla Thunderbird have ranged from 500k to 1.5M
So, that comparison was as dumb as it sounded.
http://www.ohloh.net/p/thunderbird/analyses/latest
"Its nothing more than your average computer application, like your email."
Yeah, tell that to Sergey Aleynikov.
ISM comes in weak and Pisani sounds down right hurt.
You think Bob Pisani might be experiencing Cognitive Dissonance?
Really funny stuff. It's great to have a litle brevity with all this otherwise day-to-day "bull" crap.
Consider new terms Very High FT, Ultra High FT, Infra Red FT, Visible FT, UVFT, X-Ray FT and finally Gamma FT.
she's got a great sense of humor, tho.
Cash Cow said something very profound. "If I know about a stocks activity a day before, it is called insider trading, if I know about a stocks activity one second before, its called high frequency trading."
There you have it folks, leave it to a comedian to point out the ugly truth. High frequency trading is INSIDER TRADING.
Actually, if you have access to and trade on material non-public information, then it is insider trading, regardless of how quickly you got that information. Getting public data and trading on it is not the same thing, even if you get it faster than other market participants.
The skit was pretty funny, but hardly without bias and not fact-based. Much like a lot of stuff you watch for entertainment.
Oh, a dictionary definition. That helps tons.
Insider information is information gleaned from being on the inside as opposed to -- oh say -- out on the sidewalk reading the WSJ. Inside *what* might be germain to a Grand Jury, but inside is still inside. Every child knows this.
If you buy/bargain a seat at the Board table, you get to play at insider trading in the traditional sense. And you could go to jail.
If you buy/bargain a low-latency seat in the right co-lo, you get to play at insider trading in the HFT sense. No jail time.
Being inside is all about privelege, and always was. You get better access, you get better deals and better returns. You get access by being big, or knowing big, or having big bux. Little people don't get to play.
See? We ain't so stoopid. But anybody still dealing in traditional Boardroom-level insider trading is a hopeless fool.
cougar
Cougar,
You seem to define insider trading as anything that costs money to help traders to take advantage of inefficient prices. By your argument, if you buy research from a firm, buy screening software, or buy a subscription to sentimentrader, you are insider trading.
In an environment where we weren't so collectively ready to stone anyone who makes money on Wall Street, I think it would be plain to see that devoting resources to correct inefficient prices is actually a good use of capital.
I see little danger that we'll devote 5% of the GDP to HFT.
You heard the lady. That's not for HER to decide. She doesn't have to have a concious. She has the SEC to do that for her!!! I mean she has a degree in this shit. Would people give people degrees in unethical stuff?
Why is it that comedians give us a better look at the news than news organizations?
Reading these comments is absolutely hilarious! "I get Ole'd (like a bull going by a bullfighter) every time I hit market buy or sell for more than a 2000 shares. I also get 15-20 different fills at different prices. It's a joke and hurts like hell." Are you sending a market order of 2000 shares to a book that has 100 shares on the BBO? That's your own fault for being a moron. HFT has provided more liquidity to the market. Plain and simple. 1/16 are gone. Penny spreads are here. Don't be a moron and try to create your entire position in one market order on a symbol whose ADV is < 100k. Generalization, but you get the idea. Market makers aren't getting all the time in the world to decide which px they want to execute at w/ 1/16 spreads anymore. HFT use technology (that ANYONE can use if they have the capital. Sorry it's not a handout, crybabies. Capitalism SUCKS! Cry me a river) to race each other to the front of the line at just about every single price point. How is that not good for making the market efficient? And to all of you idiots out there, who assume the major liquidity players in the market are giving you these "piecemeal fills" then you may wanna check with your Ameritrade representative. They are the ones screwing you over. Does anyone here even know what RegNMS is?
'Does anyone here even know what RegNMS is? '
Is it overseen by the SEC?
Everyone should be able to see stock prices and purchase stocks at the same speed in a market without having to buy a special program used to game the system. It has nothing to do with capitalism. I'd also get rid of market makers, not needed. Markets don't have to be efficient and they don't have to be liquid, period. Market makers and HFT platforms take money out of the system at the end of the day, or that is their intent anyway, they don't add money to the system.
You don't think the market needs to be efficient and liquid? You don't think price discovering at the fastest speed possible is better for the market? If that is the case then this argument is worthless. It'd be like me trying to convice you why the world would be better if Jesus never had a cult following. If you believe in god, the argument is pointless. And funny enough, just like i can't say for certainty whether or not god exists, i also cant say for certainty that tight spreads are the best thing for the market. I mean lower volume and wider spreads seem like theyd be more open to manipulation, but if someone is willing to buy through a $1+ spread then maybe there's nothing wrong w/ that. I don't tend to find any value in that argument though.
Why do spreads have to be so big? If there is a willing buy and a willing seller on a platform. What is anybody doing? Where is the risk to cause a larger spread?
Spreads increase with lack of incentive to make a book. Take away rebates for adding liquidity in every market and the average spread in the market will go up. This is not rocket scientist sir. Read a book. Stop blabbing when you have no actual knowledge of market structure. You come off looking like a crybaby. Nobody wants to look like a crybaby. Right?
I don't need to read a book when I know I am getting fucked. I understand that our market structure is completely flawed and corrupt. HFT and market makers take money out of the market, front run us, but somehow are doing all of us one big huge favor. This is the dumbest propaganda that has ever been put forth in the history of time.
I'll spend the rest of my life looking like a crybaby if, in the process, can help educate the populace and expose people like you that are blood sucking leaches. That don't have the investment savvy to make money the other gazillion ways out there. Pathetic really, oh, and let's not forget illegal. What size orange jumpsuit do you wear?
There will always be someone faster. Unless we are all in the same room at the same time. Speed will ALWAYS be an issue. If it werent for co-location then people in NYC would have advantage over those in the great state of Kansas. Good thing i have a machine connected to Nasdaq right next to Derek Jeters. and i dont have to deal with all the guidos. its awesome!!!!!!!!!!!!
Speed will always be an issue, it will never be a perfect system. Co-location is bullshit, though. It takes one problem and makes it a bigger problem. You are gonna have to warm up to the idea of moving to NYC when they unplug your front running, illegal, co-located server. You and Toto are going to have to pick up and move. Look on the bright side, less tornadoes.
I mistook this for a blog with intelligent people. my bad. I dont blame you. Its just naivety
if you're a retail trader, you are absolutely not getting fucked. it's easier (narrower spreads) to trade than ever, and you're not trading size that other (HFT algo's) can capitalize on if they see it.
If you're a sell side broker, your job is harder than ever - because HFT algo's are competing with you for the excellence of execution (shout out to Brett the Hitman Hart).
I am fully aware that if i went back to my job on the sell side, it would be HARDER to execute client orders with HFT algos competing with me - that doesn't mean the proper thing to do is to ban HFT.
I am surprised to see ZH readers constantly voice a desire for penalizing those who have, through capital investment, brains, and opportunities that are available to anyone willing to make the financial and time investment, attained a position which allows them to do something better than someone else. That's called socialism - it's just not what i'd expect here.
i wish i was so eloquent
i'm amazed you made it this long without anyone accusing you of being a schill for Goldman Sachs. congrats.
haha. thanks. Goldman sucks. They are fully levered with junk that will blow up in their face again. GETCO makes maybe 1.5-2mill a day. The top HFT firm in the world. GS brings that in from retail orderflow several times over in the day. People need to learn where the real evil is. Your trading fees are what is buying GS donks their boats.
http://www.informationarbitrage.com/2009/06/the-quants-must-be-crazy.html
Spreads are NOT the issue. Spreads misdirect the debate. If you have a buyer and a seller, spreads should be next to nothing. The market maker is the one who convolutes everything. And I am a free market libertarian, having a fair and free marketplace is extremely important. Oh, and if there is not a buyer or a seller for a stock, that is a free market! Sorry if it makes your job more difficult.
Let me reiterate one point. It is impossible for HFT and market makers to have an overall benefit on the market if they are taking money from buyers and sellers. Once again, no problem with how much anyone trades, just have a problem with people being allowed to get the information before everyone else.
These are simple concepts that anybody can understand.
your statement is completely inconsistent with a free market libertarian.
here's the key point: no one is "allowed to get the information before anyone else." absolutely ANYONE has the right to co-locate at the exchange, develop a high frequency stat-arb model and try to make money doing it. ANYONE. guess what - it's not easy, it's not cheap, it's not free money, and it's not guaranteed. It's a business risk that ANYONE can attempt.
air
Just because they have made a time and capital investment into this does not mean what they did was legitimate or valuable.
It fact, it is not legitimate IMO because of the infromation asymmetry and it efinitely not valuable despite the money they get from it. Somehow though, because I believe the market always works itself out efficiently, the tue value of this service will be exposed sooner or later.
I would actually welcome high spreads as long as it leads to the discovery of the true price.
Something that you need to understand is that liquidity does not ensure an efficient market. If information asymmetry exists and infects the market systemically then you will not have an efficient market.
are you arguing that a bug will bring down the system. is that what you mean by information asymmetry?
Im not sure that a "computer error" or such will bring down this system but I do believe that the risk here is hidden.
Flash orders are an obvious example (hopefully) of infromation asymmetry. dark pools too. A far more debatable case for asymetry is the fact that only a few market makers know the algorithm that accounts for a large percentage of all trades on the NYSE.
That restored my confidence in the SEC, FINRA, and the markets!
SEC as a whole may not be working, but that doesn't mean there aren't pieces that they regulate fairly and efficiently. Are you a child that assumes that something you come to find as "bad" is completely, 100% all the time, "bad?" That's a pretty narrow viewpoint. I mentioned RegNMS to explain possible "piecemeal" fills. If rhinotrader is getting these small fills, but all at the same px, he can thank the SEC for finding him the most shares at the px he wanted. Thank god for RegNMS and the sophisticated routing structures that have been created in lieu of it
Sell bullshit someplace else, give me one thing that the SEC regulates fairly and efficiently. There budget should be exactly zero. They should not exist.
If the SEC didn't regulate px fairness in the market (Reg NMS), then HighFreq shops would LOVE it! They could arb the F out of different ECNs px's and latencys. AND they wouldnt have to pay SEC fees(which are ridiculously high - due to come down Nov 1 because the SEC grossly overpriced their fee)! HFT would be killing it without the SEC. But then again HFT employees wouldn't be getting fair execution in the personal accounts(ie theyd inevitably pay a penny or two more on top of the ~$4-$100's they pay their broker for execution (which again is where the crime is actually taking place)). Good thing for people like those that created BATS, which were originally HFT that were sick of Nasdaq and NYSE raping the general public with insane fees which caused wider spreads. HFT now make in pennys what market makers used to make in dollars while tightening spreads. Where is the problem?
Nasdaq and the NYSE need either competition or serious regulation so people aren't getting screwed.
There are markets all over the place, from EBay to Craigslist, that don't have any of these problems.
I don't care how frequent anyone or anything trades as long as they can't see it first or do it faster.
Nasdaq and NYSE do have competition. BATS, DirectEdge, etc. With them came more competitive pricing and tighter markets. I really don't see the argument here? Use a limit order. Don't EVER use a market order. If you are worried about executing right now this very second cause your technical indicator says to do it, then you're just plain silly. You're payin a spread on top of your brokers INSANELY HUGE FEE!!!!!!!! How much do you get charged to execute 5k shares of a sub dollar stock by your broker? I'm gonna guess $100+ (little knowledge here that will BLOW your mind. your broker that just charged you an assload for that order, just sold it to a darkpool - thats a double profit. must be nice and all the while you have 0 idea whats happening, but some dude in the news doing HFT who is tightening spreads by being faster than the dudes on the floor is getting sh*t from you? Makes ZERO sense). Where does the real problem for individual investors exist again?!?!??!?!?
AND HAHAHHAHAHAHAHHAHAHHAHAHAHHAHAHAHHAHAHAHAHAHAHA to you comparing the US Equity Market with EBAY and Craigslist. OMGFG HAHAHHAHAHHAHAHAHAHAHAHAHAHAHAAAAAAAAAAAAAAAAAAAAHAHAHHAHAHAHAHHAHAHAHAHAHA!
Please advise how a VWAP block can be executed as a limit order.
How many indivual investors deal in VWAP blocks? But isnt the general point that the spreads are only 1 penny wide so if pennys dont matter to you (but dollars do) then there is nothing to complain about - and if pennys do matter to you, then raise some capital and colo w/ Nasdaq. There is more liquidity than ever at tighter spreads than ever.
anything else? you're "cool" facade w/ the whole Fight Club thing is very inviting. Having to wait a couple days for a really cool super secret email. Awesome. But dude, you're prob just an ex sell side guy that is pissed that you cant steal the spread from high latency orders and have your finger up your ass at the same time. I'm sorry that innovation has won. What a terrible world we live in.
you bring up some amusing assumptions. all wrong, mind you, but quite amusing nonetheless. and as for waiting for a secret email, i do not recall anyone forcing you to ask for an account.
Why don't you address my "amusing assumptions" and tell me why they are "all wrong?"
I'd love to hear your rebuttles.
"A great many people mistake opinions for thoughts." -Prochnow
Sir, please stop pretending to be an expert. The competition to the traditional exchanges that you speak of will be viewed by historians as yet another example of the rampant regulatory arbitrage that along with so many other flawed concepts of "financial innovation " have brought us to the sorry state that we are in. High Frequency Trading will prove to be the ultimate undoing of not just the equity markets, but all of the markets. Fools like yourself rationalize it all away by saying that past transgressions justify the current ones. Go text somebody quick ! Grab a wheatgrass shake to go and take your fake intellectual superiority with you.
Never pretended to do anything. Competition to people shouting orders from phone calls to guys with minimum 1/16 spreads is what "brought us to the sorry state that we are in?"(anyone know the proper grammar here?) haha....anyway. yeah. the state the US Economy is in has everything to do with that. Nothing to do with people buying houses for more than they could afford. Nothing to do with the fact that we don't export anything of value. Nothing to do with you running up your credit card debt cause your'e an American and there will ALWAYS be a job for you. You're right. More liquidity in the marketplace has F'd us!
MrKansas - I agree completely with everything you say. However, you're fighting a losing battle trying to explain the issues to the people on this site. It's not expensive to colocate people! If you can, through your own intelligence, write a program that works, it's not that hard to put your plan into action. If you are dumb, you will colocate and your hft program will simply lose money faster. For all those who advocate banning hft because they comprise 70% of all trading volume, i ask you this - what happens to you, the angry little peasants, when 70% of the volume disappears? You pay much bigger spreads!
Most people have no business doing hft. But all investors should be thankful there are those that do, who give them the ability to pay smaller commissions for their own orders.
Okay you win. There is tremendous value in having HFT inflated volume in every distressed security on the planet. We are all better people for it. I have seen the light and I'm offering my left kidney on Ebay so I can co-locate and brush up on my grammar. Have your algo call my algo and we'll do lunch.
"HFT inflated volume" doesn't exist. volumes have increased because the us economy sucks because we overleveraged ourselves and now the rest of the world doesnt wanna allow us to be in debt to them anymore. HFT has been around for years. volume has only spiked since the financial crisis. thanks though
for readers who actually want some objective perspectives on volume and HFT
http://www.aitegroup.com/reports/200902251.php
just because the % of HFT has increased doesnt mean market volume has increased because of HFT. simple logic really.
What is wrong with more people trading at high frequencies? They all have different models and time horizons. Its the same game just faster and because of that allows for more efficient arbing and therefore a more efficient market.
ie. GS doesnt ship millions share of BAC through a block trade anymore. Instead they trade those millions of shares in 1 lots(100shares) thousands of times throughout the day as to not expose thier hand = HFT. Does that really sound like a bad thing to zerohedgers?
Great thread
Kansas, I don't use fucking market orders, don't waste the cyberspace. I pay a flat fee of $8.95. Man you make some bad assumptions. I'm no fan of dark pools, they need to be totally exposed.
And yeh, it is hilarious to compare functioning marketplaces to the US equities market. You made my point. My point was not that they are similar but that they are functioning without all of the problems of the US equities market.
why don't you like dark pools? if you think the HFT guys are getting information faster than you or processing it better than you, then wouldn't you rather NOT HAVE THAT INFORMATION? that's called a dark pool - you don't see an order book - so you can't capitalize on it with an HFT stat-arb program.
this is the biggest inconsistency i see on this site - people complaining about HFT In one breath, and then dark pools in the other. dark pools are the gift you have to go HIDE from the HFT predators.
you can never prevent someone from being first or faster. or better or smarter. that's what i don't get about your argument. someone will always be the best. fine - i understand your argument against co-location. if you get rid of it, now the guys in NYC will be able to see market data a millisecond before the guys in Cali - then what? and as for interpreting the data - someone will always be able to interpret what your nickel bid for 30,000 shares means for the future price of a stock better than you can - it's not front running.
Kid, I want people to be better and smarter. I like hanging out with people who are smarter than me. I spend a lot of time on this message board because there are numerous people on this board that seem to be smarter than me. I like to debate on this board because that is how I learn and maybe once in every blue moon someone may learn something from me, however unlikely. But in my opinion, what is being allowed is special treatment, allowing people to cut in line.
Let me put this in perspective that I hope anyone can understand. And I may not understand everything perfectly. If I walked into the NYSE and said hey guys I need to put my server in between the NYSE servers and all these co-located servers of GS, Credit Suisse (just examples), etc. they would say you have totally lost your mind and get the hell out of here. But when these large financial institutions do it is ok?
In a fair and free market, information should go out at the same time and should not be intercepted before it leaves the building to the advantage of others. I understand the system will not be perfect, and that if you are further away info. travels a little slower. Can't do anything about that at this point. But you can move East if it is that critical to how you trade/invest.
http://www.nasdaqtrader.com/Trader.aspx?id=colo
Throw your severs up there. Have fun! Or continue to love socialism. One of the two. I don't give a shit
In front of yours? You got me if you would be good with that.
BTW, what we currently have is a fascist oligarchy. I am no socialist, you are the one who has a problem with competition! Don't want to buy and sell at the same time as everyone else? Competition sucks doesn't it?
you're really gonna argue over which rack you're on in Nasdaq's colo center? Seriously? Show me proof that there is advantage to a few feet here and there in their data center. Show me please!!!!! i would LOVE that.
No, it would be in between. Proximity has nothing to do with it. My server would stop the information flow to your server. Look at buy/sell order flow and I would unleash the algs to do their magic.
Enjoyed the debate. I'm done.
you obviously have ZERO idea how colo works.
Wasn't specifically talking about colo but clearly am not an expert. Was talking about getting information before you that would give me an advantage. That was my point.
But you have the floor. Explain to me how the whole co-location system works so I can be better informed. So you can change my mind that there is no advantage. How I will be amazed that anyone even decided to co-locate their servers there to begin with.
All ears.
Explaining a barrier to entry...? hmmm. no thanks. its all on that website i provided, plus the countless pieces of literature available on the www
I laughed so hard, I had to watch it twice. Someone needs to write a program to counter the HFT by putting out false indications to F#$#@ the algorithms. Kind of like electronic counter measures LOL.....
Darn didnt realize you had this already posted,
Thanks for that great debate. Kansas, lay off the blow man, I can hear your heart pounding from here...
would never litter my beautiful nostrils w/ that trash. i stick to heroin ;-) ;-) ....and "great debate"...i dont think so. you guys listening to CNBC can s my d. heres one that will blow your mind. FLASH orders were GOOD for the market. The most efficient market is a locked market. think about that one for awhile
This is probably the dumbest thing I've read on this forum. You know what you did wrong hopefully, you didnt account for TIME and ADDITIONAL INFORMATION that comes along with it, and by doing so you've spilled garbage. It happens to everyone but I've never fucked up so badly in my reasoning as to forget time entiely.
And this statement explains a lot of your stances. You dont care for market efficiency as long as there is more liquidity. We just know that a lot of the garbage that are on the books of banks were liquid in 2005 but market efficiency won out in the end and now we have had to intitutionalize accounting fraud and market them to fantasy, even though they were so darn liquid once.
the option to buy and sell at the same price is the most efficient point. It means this is the price right now. There is no penny spread. This is the price. Its such a simple argument. How do you people not understand? and flash orders are OPTIONAL!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! you dont have to send your order to the market as FLASH!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! its OPTIONAL!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
...you're still forgetting the effect time has on infromation an the subsequent effect aditional information has on prices. There will never be a zero spread because time will never stand still.
markets lock for seconds at a time.
you do understand that securities are traded on more than one market right? just cause a security is listed on NYSE (ie BAC) doesnt mean it only trades on the NYSE platform.
Nasdaq can lock the BAC px at BATS, BATS at NYSEARCA, etc.
I like your tag "TumblingDice." Seriously. I think randomness is the coolest f'n thing ever. The market is still random. just because GS bought 30k shares of X security at 30.50 doesnt mean shit about when they will buy or sell next. What HFT allows for is keeping every market within milliseconds of each other so that when Exchange X's offer lifts, exchange Y isnt too far behind. The closer every markets px stays to each other the more efficient the market.
Computers are unable to generate truely random numbers. They read timers which is a sine wave. Sine waves in electronics work like pendulums do in phisics. They spend most of thier time at 2 places while moving rapidly through the rest of the wave. Though it's hard to call anything in a computer a wave they are so fast these days. More like semi formed pukes of signals. You need a white noise generator to truely generate randomness.
Man you're really pissy. It's like you got in at the ass end of a scam and had all these big ideas and dreams and then it exploded. Geez. What's even worse is this is like a giant turd in Intel and IBM's punch bowl. IBM might actually have to make commercials and serve the public or something just when it was on easy street. Those damn consumers who aren't completely wrapped around your nuts for speed and power are just a bitch to deal with.
Wow! Look what our stock market has turned into. It has nothing to do with buying a piece of a company anymore.
Well Kansas, I for one am for a thorough INDEPENDENT (if even possible) investigation of HFT, flash orders, and co-location by competent, reasonable experts in the field to make sure everyone is getting a fair market. I am sure we can at least agree to that. I realize that you have your hand deep in the cookie jar and you have a lot to lose. Absolutely nothing to fear if you are creating a more fair and efficient market.
I have nothing to lose except an efficient market. I'm a hs english teacher. ;-) ;-) I have 0 problem with regulation. Get ur investigation over with, see that its actually a good thing, and then go regulate overleveraging of derivitives by companies "too big to fail."
I'm in real estate, construction, and development. Um, sort of, until the market imploded. Commercial, nothing to do with the sub-prime mess. Actually, over-leveraging of derivatives by companies too big to fail would be much higher on my list. I would actually force all of them into bankruptcy. No such thing as too big to fail. If you are too big to fail you are too big to exist.
To many people are getting High Frequency Trading confused with Flash Order trading. High frequency trading is simply day trading and has been around over 100 years. Computers now do most of it.
Flash orders are used by some. It allows you to see other orders a fraction of a second before everyone else. There are only a few High Frequency Traders that do this. Most simply provide liquidity and are coveted by the exchanges.
The media has clumped them all together. I would expect more from people on this site.
100 years. Ya that sounds about right. Those dudes in 1908 would get all jammed up on coke and be all like MUTHAFUCKA. YO STOCK IS STASTICALLY DIVERGENT. SELL THAT SHIT TO ME RIGHT NOW!!!
Man those were good times. Watching people stroke out on the trading floor breaking their pencils cause they got to hot when they wrote too fast. The sound of those clanking abacuses. Charles Babbage followers setting up monster giant fucking wooden difference engines on the trading floor and wipping orphans to make it run faster. LOL. Dems was gud times man. Good thing the stupid fucking media stayed out of it back then cause they would have just got it all confused and shit.
Hey, this is the latest (as far as I can tell) article by Aldridge (cool graphics): http://www.eforexnews.net/eFX_October_09.pdf