An Insider Exposes The Algo Secrets Of The FX Market

Tyler Durden's picture

From algos to trading pschology and from market-maker's tricks to the quant models that dominate, Batur Asmazoglu provides an insider's view of a large sell-side bank FX trading desk. While the likes of Goldman's Thomas Stolper have proved it, Asmazoglu's first 'secret' is that "while many believe the big investment banks are very sophisticated, that is not the case at all."

 

h/t @bondskew

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stocktivity's picture

It's all Bullshit!!!

Silver Bully's picture

I can't wait for the day when they ALL cry 'Turn those rmachines back on! **TURN THOSE MACHINES BACK ON!**'

 

http://www.youtube.com/watch?v=dKYM62qSA_0

Eeyores Enigma's picture

So as a leech when you sink your sucker into your host you have to be lucky.

 

You can almost always get some blood flow. If your lucky you can hit a vein and you are pulling in what you want.

 

 You could also hit a main vein that for some reason is getting pumped up by the host and your ass will explode.

 

Fucking leeches talking as if what they do is important. I vote we hold a match to their head.

cocoablini's picture

The real trick is that the main banks have insider knowledge of events. The FED is leaking info and then the computers know exactly how to push the prices. No matter what they come out with, they are succeeding because their miracle algos just trade on fancy insider trading. They get info early or the algos spoof trades and determine the price themselves and bet on their own inside manipulator knowledge. 

Everyone thinks these algos are super intelligent. They are fast but not super smart- so how fast you trade illegally is the miracle here

Papasmurf's picture

It's simpler than that.  They take out fire insurance.  Then they set the fire.

kaiserhoff's picture

Yes, I don't remember Peter Lynch or John Neff ever saying,

  "Of course we have to bet against our longs, at least three to one."

Back in the day, that would have been correctly seen as conflict of interest, if not plain old fraud.

Yen Cross's picture

  He must hate "real money". Real money(non levered) is invading the FX market with all sorts of gimmicks.  Personally I think they're going to get their asses handed to them.

fonzannoon's picture

I posted this earlier today, it's a great blast from the past.

http://nymag.com/guides/money/2009/59457/

 

Yen Cross's picture

  Thanks Fonz.  ;-D  FWIW, short the DAX.

smlbizman's picture

yes fonz...that info deserves a thumbs down......awesome read fonz..thanks...

Yen Cross's picture

  I enjoy tools like you smlbizman

     
       EUR         German Manufacturing PMI     51.1     51.3     51.3      
      EUR         German Unemployment Change     25K     -5K     9K    
       EUR         German Retail Sales (YoY)     0.3%     0.4%     2.9%    
       EUR         German Retail Sales (MoM)     0.5%     0.8%     -0.2%    
      EUR         Core CPI (YoY)      1.0%     1.1%     1.1%      
       EUR         CPI (YoY)      1.1%     1.3%     1.3

smlbizman's picture

yen, i hope u dont think i am the down vote....i dont know who would down such basic info....

Yen Cross's picture

 @ smlbizman  : Do some homework. Everyone deserves a second chance?

Big Slick's picture

READ FONZ'S LINK! 

2009 New York Magazine artiicle about ZH.

(Informative though some errors)

Yen Cross's picture

   When faced with reality you still deny the truth?

   I'll bet you ride a bicycle to work .  No Worrries smlbizman all in good fun.

Bay of Pigs's picture

Never read that before. Thanks. 40 Tylers? LOL...and that was 4 years ago.

fonzannoon's picture

I had not realized Marla was a partner. Also funny how soon after the site went mainstream they were accused of selling out.

Otrader's picture

Still stealing, killing, cheating and lying....ahhhh, good times.

Tim_'s picture

Don't forget the organ harvesting.

Israeli butchers harvesting corneas in Haiti - Video

Israel admits to organ thefts

"Israel has admitted that it harvested organs from the dead bodies of Palestinians and Israelis in the 1990s, without permission from their families."

"The admission follows the release of an interview with Jehuda Hiss, the former head of Israel's forensic institute, in which he said that workers at the institute had harvested skin, corneas, heart valves and bones from Israelis, Palestinians and foreign workers."

"In the interview, which was conducted in 2000 when Hiss was head of Tel Aviv's Abu Kabir forensic institute, he said: 'We started to harvest corneas ... Whatever was done was highly informal. No permission was asked from the family.'"

"During his interview with Scheper-Hughes, Hiss said that the eyelids of bodies were glued shut to prevent the removal of corneas being found out."

"Our sons are plundered of their organs"

"Palestinians accuse the Israel Defense Forces of taking organs from their victims. Donald Boström writes about an international organ trafficking scandal – and about the time he saw the cut-up dead body of a nineteen-year old Palestinian."

"You could call me a 'matchmaker', said Levy Izhak Rosenbaum, from Brooklyn, USA, in a secret recording with an FBI-agent whom he believed to be a client."

"Rosenbaum’s matchmaking had nothing to do with romance. It was all about buying and selling kidneys from Israel on the black market."

"Rabbis, politicians and trusted civil servants had for years been involved in money laundering and illegal organ-trade."

"On the question of how many organs he has sold Rosenbaum replies: 'Quite a lot. And I have never failed,' he boasts. The business has been running for quite some time."

"Israel has repeatedly been under fire for its unethical ways of dealing with organs and transplants. France was among the countries that ceased organ collaboration with Israel in the nineties. Jerusalem Post wrote that 'the rest of the European countries are expected to follow France’s example shortly.'"

"At a conference in 2003 it was shown that Israel is the only western country with a medical profession that doesn’t condemn the illegal organ trade. The country takes no legal measures against doctors participating in the illegal business – on the contrary, chief medical officers of Israel’s big hospitals are involved in most of the illegal transplants, according to Dagens Nyheter (December 5, -03)."

"While the campaign was running, young Palestinian men started to disappear from villages in the West Bank and Gaza. After five days Israeli soldiers would bring them back dead, with their bodies ripped open."

"Talk of the bodies terrified the population of the occupied territories. There were rumors of a dramatic increase of young men disappearing, with ensuing nightly funerals of autopsied bodies."

"On several occasions I was approached by UN staff concerned about the developments. The persons contacting me said that organ theft definitely occurred but that they were prevented from doing anything about it."

"Five days earlier, on May 13, 1992, an Israeli special force had used the village’s carpentry workshop for an ambush. The person they were assigned to put out of action was Bilal Achmed Ghanan, one of the stone-throwing Palestinian youngsters who made life difficult for the Israeli soldiers."

"As Bilal was put in the grave his chest was uncovered. Suddenly it became clear to the few people present just what kind of abuse the boy had been exposed to. Bilal was not by far the first young Palestinian to be buried with a slit from his abdomen up to his chin."

"The families in the West Bank and in Gaza felt that they knew exactly what had happened: 'Our sons are used as involuntary organ donors,' relatives of Khaled from Nablus told me, as did the mother of Raed from Jenin and the uncles of Machmod and Nafes from Gaza, who had all disappeared for a number of days only to return at night, dead and autopsied."

TruthInSunshine's picture

This is the kind of sick, twisted shit that really causes me to sour on humanity. It is really, truly'disturbing at the deepest depths of the human soul.

monad's picture

I wonder if this is why Feinstein and Boxer are looking so undead...

economessed's picture

Marla is missed, not for her contributions to zerohedge, per se, but for her epic weekend DJ parties that she ran, and the MP3 clips she left at 180 mb a piece.  Good times.

Trimmed Hedge's picture

Yes, the music.. Loved the DJ parties!

And her naked boobie pics..

Loved those, too...

Cthonic's picture

I still queue up her Albuterol mix.  Salut.

JohnG's picture

fimim respice is OUT.  ?? 

Atomizer's picture

Fonzannoon

 

I saw your post earlier. Marla was a wonderful asset to this community back in the day. In fact, she would stream music feeds for Friday or Saturday. We all partied from the keyboard.  

http://www.zerohedge.com/article/radio-zero-material-non-public-information

 

Don’t ever discredit the very people who helped you see through the unthinkable plots. That includes a person called Sacrilege.

 

You’re lucky my wife called twice. I don’t think this post would have gone civil.  We are a family that you can never break up. Don’t ever make comments like that again. Understand?

kito's picture

I think part of what fonz is saying is that the family already broke up. Kinda like the Jackson 5. Success can wreck a family. Happens every day.

fonzannoon's picture

where did I discredit anyone? 

what are you talking about? If you were on here yesterday there was a whole thread about how this site sold out. I found it interesting that the article mentioned the same thing almost 5 years ago. I would not have thought that. As for Marla, I did not discredit her.

Get help 

Atomizer's picture

Let’s call this a truce. I would like to explain my actions in handing your ass to you.

 

  1. Get Help? don’t need any –
  2. Missed yesterday’s exchange on this site selling out. [probably a good thing]
  3. Been here too long, become defensive in allowing this site to be ripped apart or discredited.
  4. Because the popularity of this site and limited bandwidth, you would see a screen similar to this: Marla
  5. A news link from Drudge or a whisper from Rush.. good luck getting onto this website.
  6. This site is not a sell-out, it required a small change in its model to service its viewers 24/7.

 

Believe we have bigger fires to put out, and I consider you to have the necessary skill set.

Bay of Pigs's picture

fonz is one of the good guys Atomizer. No way he is ripping ZH or the founders of this site.

I was lucky enough to chat with Sacrilige for an hour or two in the middle of the night here not so long ago. It was fantastic. 

Yen Cross's picture

Bay of Pigs   You missed the true fight club.  Ya had to know basic algebra just to place a bet. ;-)

smlbizman's picture

ur right yen....if it wasn't for the captcha, id b a 4 yr member....

Atomizer's picture

LOL, those simple math questions kept the govenment trolls off this site. I miss those days

/lol

Lmo Mutton's picture

Yea, they gave me trouble at first, no pictures of pennies and stuff.

Bay of Pigs's picture

Yeah, I started reading here late 2009, and didn't post until 2010.

I found the crowd kind of intimidating in those days. Cheeky Bastard and some of the originals used to hammer me pretty good if my posts weren't spot on. Haha.

Yen Cross's picture

  My Fellow Pilgrims/Pirates!  Good on Ya! ARRHHH.

Yen Cross's picture

 @ JohnG    You have a few weeks on me.   Why the sudden comment?

I am a Man I am Forty's picture

cheeky bastard was brilliant

Hulk's picture

reading that article is how I discovered zerohedge...many moons ago...

Yen Cross's picture

 I'm going to buy the KTM 2 stroke 250!  

Obadiah's picture

Go for the 4 stroke monster.

 

Much less maintenance and power starts at 500rpm

chindit13's picture

Damn.  I even left footprints on that article.  Guess that was back when I was full of P&V.

Odd the way this has all gone, both in the markets and on this site.  Back then, I had a lot of trouble believing things could last this long; now I smile when I read the ubiquitous, albeit varied in style, "any second now".  Around here a lot of folks have moved on, some from behind the scenes at ZH-HQ, and some on these comment pages.  Some gave up, some got bored, some didn't like the new neighbors, some realized everything possible has already been said---and perhaps better than anyone can say it now---but others feel that since authors still try to write after Shakespeare and the Greeks, what the heck.  Others got banned.  A second or two of thought and I can name fifteen shown the door.

I smile at, but never quite understood, the Cheeky cult.  He was interesting, but his departure has taken on near mythic status, perhaps owing largely to repetition of the meme.  There were many interesting posters back then, even in the "anonymous" days.  Andy Dufresne, MinnesotaNice, Agora, deadhead....lots.  Lots of FIRE-types, too, before we all got measured by the masses for our boiled rope.

Nothing is static.  Everything evolves.  ZH, and whoever Tyler #1 is now (if he is different), still deliver the goods more often than not.  Still some pearls before the swine.

Yen Cross's picture

  @  chindit13    Thanks for the "good will" last night/yesterday. (Time Zones)  You're brilliant...

Herd Redirection Committee's picture

I stay for the comments.  More people get banned, or there is more censorship (deleting of posts has happened recently, whereas it was completely unheard of, the first few years) and the community will move on as well, which would be a shame, but this fight is bigger than ZH.

fonzannoon's picture

that article was more for people on here to see what Zerohedge was, so maybe they can distinguish it from what it is. If the real Tyler is still out there he knows what I mean. Atomizer cracks me up threatening me and telling me what I can or can't say, even if it's because he misunderstood me. That comment from him tells me he has been here forever, and misses not only the whole goddamn point of what this place used to be, but what it has become.

kito's picture

atomizers comments kind of remind me of our great govt leaders, who forget what the 1st amendment is about. they evoke it when its convenient, pretend they honor it. yet threaten to silence others when its not so convenient.

Atomizer's picture

We all know about the operatives on this site. Discrediting me will get you nowhere.

kito's picture

Not looking to discredit you, but as a "founding father" of the comments section, don't try to surpress the very spirit of revolution that first brought you here. You didn't hand fonz his ass, you acted like an ass. Fonz actually did a favor to zh, he allowed for an honest gut check which brought out assessment support by many of the old timers. Kudos to fonz