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HFT Infographic

CalibratedConfidence's picture




 

You know how we feel about special order-types and expert networks.  I'll save you the long-winded paragraph so you can keep selling Amazon shares.  Here is an HFT infographic, slightly out-dated as Minoj has already begun to run his microwave trading system he bought from the Sears DIY section, which explains in simplistic terms the new dynamic of markets.

"The speed of light limitation is getting annoying"

"We have now entered an ecosystem that is remote from the human brain's capacities"

 

Infographic HFT by calibrateconfidence

 

 

 

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Sun, 02/03/2013 - 13:24 | 3211070 andrewp111
andrewp111's picture

We need superluminal tachyon-based trading. With tachyon based communication, a fast moving satellite close to the sun will be able to relay signals backward in time during the leg of the orbit when it is moving toward earth, and the product of its relative velocity x the tachyon speed exceeds c2.  Then the uber leveraged traders will be acting on a stream of future information. Of course the temporal paradoxes have not been resolved, and open the door to a true uber crash.

Fri, 02/01/2013 - 19:52 | 3207844 Mudja
Mudja's picture

I tried FX, I was disgusted with the way lag was used to fuck you over. I thought i would try with a minimum deposit - I lost some, but sought solace in that the experiment proved FX, like equities and all other markets, is just toxic. Let the computers play with 1s and 0s. I'm getting myself some more silver.

Fri, 02/01/2013 - 14:37 | 3206851 ebworthen
ebworthen's picture

The Matrix is good to me as long as I remain somnolent and don't ask questions.

Fri, 02/01/2013 - 13:41 | 3206704 Never One Roach
Never One Roach's picture

Reminds me of the "rabbit in the stroller" formation.

Fri, 02/01/2013 - 12:15 | 3206410 SAT 800
SAT 800's picture

Waste of time article. wasted more time saying it was a waste of time. time to go make some coffee. it's 6:15 am here.

Fri, 02/01/2013 - 10:58 | 3206089 moneybots
moneybots's picture

"The problem isn't deregulation, it's *No* regulation, that is, no accountability to the law (or worse, no law to be accountable to)."

 

Isn't that what deregulation really is, no regulation?  Setting the wolves free to enter the sheep pen and slaughter at will??  Greenspan remarked that he thought the bankers would be more responsible.  Just how did he think the bankers would be more responsible, when he opened the door to the sheep pen?  Irresponsibility is what Greenspan wanted, as fraud is at the heart of any financial bubble.  Greenspan wanted a housing bubble.  Greenspan told home buyers to get adjustable rate mortgages.  Rates had nowhere to go but up, when Greenspan said that.  The FBI warned of massive mortgage fraud in 2004, yet Greenspan praised lenders in 2005.  What Greenspan was actually praising was mortgage fraud.

Greenspan wasn't some rube who got taken by a bunch of reckless bankers.

10,000 Appraisers complianed to the government about appraisla fraud in 2001.  NOTHING was done.  States attempted to prosecute predatory lenders.  The Bush adminiistrations stepped in to prevent them.  The FBI warned of massive mortgage fraud in 2004.  NOTHING was done about it.  In 2004, the big five investment banks got leverage waivers.  In 2005, the bankers got the bankruptcy laws changed.

They called it deregulation.  It was actually something else.  Deregulation  was a code word.

 

 

 

Fri, 02/01/2013 - 11:20 | 3206196 ZDRuX
ZDRuX's picture

Everyone in the market is there willingy and is free to leave and stop any second they wish. Please don't make it sound like we're forced to be subjected to this HFT craziness, we choose to stay here knowing the odds.

 

If someone is "forcing" you to do this, then call the cops, not the government. Stop asking for government to fix everything that is an inconvenience to you simply by saying you're being "slaughtered".

Thu, 02/07/2013 - 08:07 | 3222483 CalibratedConfidence
CalibratedConfidence's picture

ZDRux:

We are forced to pay taxes which in turn fund our regulators. The SEC has rules in place it selectively enforces. the exchanges have created special order types which general market participants can't use, along with a majority of institutional traders. These order types are available to specific traders, with specific systems, for use at specific times, such as during a locked market or to create a locked market.

What "cop" would you suggest we call? This is a federal issue and requires Congressional power to investigate the necessary records. Local cops, community watch people, state police have no jurisdiction in this arena.

This is not merely an inconvenience, as most outsiders assume, it's a skirting of federal law and an uneven playing field. If you played chess and your friend moved his pawn as a queen, surely you would object. Special order types are like that.

We may choose to be here but we didn't choose to have our assets priced here. Those with 401(k) do have the choice to not invest it but too many are to misinformed to recognize a better alternative, company match plans are just that appealing.

So while individually we are not forced to be here, the things we purchase with the money we earn for exchanging our skills are priced here. The manipulative tactics surrounding basic price discovery are illegal.

Thank you for thinking your comment through.

Fri, 02/01/2013 - 14:18 | 3206765 Widowmaker
Widowmaker's picture

Great point.  The Mexicans that care for Widowmaker properties have been literally loading up silver since before 2006.

Non-Spanish speaking Widowmaker finally figured it out when it was just under 18, but didn't get on that train (took long AAPL instead).

After shorts got blown out Widowmaker is done with equities until a real crash bottom.

There is no market, there is only institutionalized fraud by the Federal Reserve Bank of Fraud and Terrorism.  The Fraud-Fed needs to account for obstructing the rule of law and perverting justice Inc. 

End the Fed - the future of your grandchildren depend on it..

Fri, 02/01/2013 - 12:06 | 3206381 fortune114
fortune114's picture

Here here.  I don't know that there was any time in history where well-capitalized participants couldn't obtain a significant "structural" advantage over retail traders.  Floor seats.  Specialists.  Probably other things I have never heard about.  So now a computer is front-running our orders instead of a guy, and doing a better job of it.  Big deal. Bad traders are always complaining about something.

I really like robot cartoon.  

Fri, 02/01/2013 - 12:59 | 3206537 CalibratedConfidence
CalibratedConfidence's picture

its not about having an "edge" its about coluding with the exchanges to create special orders to be used only by certain participants for at very specific times.  Orders you couldn't can't find.  It's about skirting rules, flipping your maker order into a taker order, sliding your order to less appealing price, locking a market to manage your place in the order book.  This goes way beyond seeing some order flow or being close to the action.  This is moving your Pawn like Queen before getting to the other side of the board. 

Fri, 02/01/2013 - 09:08 | 3205713 Eumaeus
Eumaeus's picture

"Stock exchanges became for-profit, listed companies, competing with each other. Serving the real economy becomes a secondary purpose. ... The system tends to serve its own purposes."

What place do these anticapitalistic musing have in an useful overview of HFT? Profit is theft, competition is evil, the 'real economy' isn't being served. Boo-hoo.

The problem isn't deregulation, it's *No* regulation, that is, no accountability to the law (or worse, no law to be accountable to). Besides, how can regulation be of any use when the regulators are both ignorant and malicious?

Anyway, HFT is a scam, to be sure, and I appreciate your efforts to destroy it.

Fri, 02/01/2013 - 09:06 | 3205707 Downtoolong
Downtoolong's picture

I like the last pic of investors running from the markets. Unfortunately, it neglected to show the Fed and big Ben running in to take their place. After all, the markets can never die, even if Main Street turns into a dustbowl.

 

Fri, 02/01/2013 - 10:22 | 3205962 fourchan
fourchan's picture

who are the firms using this technology? if i cant beat them, and we clearly cant, i want to join them.

Fri, 02/01/2013 - 13:36 | 3206684 Alpha Monkey
Alpha Monkey's picture

It's called the .01% for a reason...

Fri, 02/01/2013 - 08:11 | 3205583 LongSoupLine
LongSoupLine's picture

We fucking know all this here at ZH. Find a fucking way to get Joe the fucking Plumber and his Starbucks drinking, x factor watching fucking wife to get pissed off enough about it to kick Congresses fucking door down and smash some fucking teeth.

Fuck you SEC and fuck you American voters for keeping fucking criminal shit eating fucks like Pelosi, Reid, Obama,Waters, etc in office you fucking full retard assholes.

Mon, 02/04/2013 - 23:28 | 3215375 MeelionDollerBogus
MeelionDollerBogus's picture

Sure is a good thing the SEC's top legal counsel is MF Global's former legal counsel, on guard to "protect investor integrity"

Ya that's right, I fucking said it.

Because they fucking said it.

You want a puke bag now or would you like a handy-dandy(tm) Soap Street flight-card?

Fri, 02/01/2013 - 09:48 | 3205847 eatapeach
eatapeach's picture

Jane Harman

Fri, 02/01/2013 - 08:52 | 3205666 CalibratedConfidence
CalibratedConfidence's picture

Glad to see you're fired up. Won't you join in?

http://www.zerohedge.com/contributed/2013-01-29/its-time-us-govt-finds-o...

Fri, 02/01/2013 - 12:07 | 3206379 LongSoupLine
LongSoupLine's picture

I've written and called my fucking Congressional reps more times than I wish to fucking count.  I've spoken clearly and concisely on subjects of Fed printing via illegal bond monetizing, HFT, dark pools and various other subjects directly pertaining to the true recovery of this nation.

 

I've received full retard programmed responses from interns and aids as well as wonderful form letters in response.

 

I joined in long before your articles.  These fuckers are all complicit and I'm convinced a fucking hot blacksmith iron down their fucking neck or steal toed boot to their fucking nuts is the only thing that will get their attention.  Conventional means to invoke change are what they fucking hope people will stick to.

Fri, 02/01/2013 - 13:46 | 3206724 NeedtoSecede
NeedtoSecede's picture

Love you passion LSL, and agree with you 100%.  The "elite" just don't give a shit and this has been true for a long time.  The only thing that has changed is that they now make no effort to hide that fact that they don't give a shit.  And even when they go full-on Corzine they know they are above the law.

I know the game, and I choose to play in areas where I still think I can "invest" with some chance at success, but I am also looking hard at all alternatives and positioning accordingly.  I just need a little more time to stack (I got a late start) before I will sleep well no matter how the clown circus in DC tries to crush us.

Fri, 02/01/2013 - 08:03 | 3205571 MillionDollarBoner_
MillionDollarBoner_'s picture

blah...much needed liquidity...blah...strict regulatory oversight...blah...level playing field...blah...inevitable technological advance...blah...need to remain competitive...blah...

PS SLJ is Da Man ;o)

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