Heat Wave Is Slowing Stock Trades Between New Jersey Data Centers

The record high-humidity heat wave that's hammering the Tri-state Area is making life difficult for man and machine alike. According to Bloomberg, the heat is so oppressive it is delaying radio transmissions between the three New Jersey data centers where most of the equity trading attributed to "New York" financial markets actually takes place.

High humidity is impeding radio transmissions Tuesday among three New Jersey data centers where U.S. stocks trade, according to a note Nasdaq Inc. sent customers.

According to the Nasdaq disclosure, it is now taking about 8 microseconds longer to send information from Nasdaq’s facility in Carteret to the New York Stock Exchange data center in Mahwah, and an extra 2 microseconds to send data to Cboe Global Markets Inc.’s exchange in Secaucus.

For HFTs, most of whom use microwaves to transmit orders, and some of which are using lasers, this is an eternity when it comes to frontrunning traditional orderflow or creating mini momentum ignition events at just the right time.

In other words, this is one of the few times when the HFT industry, looking at millions in foregone profits, can legitimately blame the weather on their woes. 

Tower
The New York Stock Exchange tower in Mahwah, New Jersey

Naturally, those carbon-based traders with enough foresight prepared for just this eventuality and paid the NYSE even more millions to upgrade to the laser network that was installed a few years back to shave a few nanoseconds off the transmission time between the NASDAQ and New York Stock Exchange towers, as we profiled at the time.

Luckily markets are closing at 1 pm today in observance of tomorrow's Independence Day holiday. Hopefully by the time markets reopen on Thursday, the heat will have broken.

Comments

spastic_colon Tue, 07/03/2018 - 12:39 Permalink

apparently it only slows down selling......

cue a Comcast meltdown in 3....2....1

if anyone was ever curious as to the lengths they'll go to support price levels now they blame heat and humidity.....al gore must be the only source of info today.

bluskyes Tue, 07/03/2018 - 12:46 Permalink

I wonder if those laser signals could be interfered with, using atmospheric refraction - by placing a stream of extremely hot air between the end-points.

BandGap Tue, 07/03/2018 - 12:49 Permalink

Does this system run during rain storms? Pretty sure the humidity is spiked at that point. Does ice ever form in the transmitters and/or receivers? 

Resistance increases as a function of temperature. Then the winter would be best for HFT.

I call bullshit, they need an excuse to shut things off.

 

MusicIsYou Tue, 07/03/2018 - 13:01 Permalink

Ooo it's going to be a hot hellish day for haha Independence Day, how fitting. While idiots by the millions celebrate Independence. Those people probably think they'll have life after death someday, but I don't see how, because they are not even alive now.

rejected Tue, 07/03/2018 - 13:10 Permalink

According to National Weather the average in NYC for July is a mere 85 degrees. 

It is now 91,,, OMG! Global Warming.... Time for another SUPERSTORM Sandy. 

just the tip Tue, 07/03/2018 - 13:24 Permalink

all of y'all east of the mississippi fuck you and your heat wave.

all of y'all west of the rockies fuck you and the east coast heat wave.

without those, the US would be a better place.

 

Chaotix Tue, 07/03/2018 - 15:36 Permalink

it is now taking about 8 microseconds longer to send information from Nasdaq’s facility in Carteret to the New York Stock Exchange data cente

 

OMFG what a Greek Tragedy!! These stock market pussies are whining about 8 Microseconds?!! Oh the humanity...

That is the price you pay to play in the giant field of micromanaged, over leveraged, flash trading, hell holes of financial sluttery. The velocity of economic interactions are so ridiculously fast that it never has time to adjust to reality. Never has, never will. I learned a while back about the importance of both Velocity and Volume of stock trades. They have too much velocity and not enough mass. It has to wobble like a bubble when it stops, and sometimes they pop.

 

Oh yeah, and global warming is melting the glaciers, making the humidity higher, for the single purpose of slowing down the Flashers.

SmittyinLA Wed, 07/04/2018 - 07:11 Permalink

I wonder how easy it would be to turn an old microwave oven into a microwave disruptor, or phased radar array? I think the algo-traders would pay a lot to find out or fuck up their competition.

I see an arbitrage opportunity, pay up or we cut off your front running the market.