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You can buy yourself a server for $5K and connect to some exchanges for as little as $5K/month. Our costs run in the neighborhood of hundreds of thousands per day. It all depends on what you want to connect to, how good you want those connections to be, and how many of those connections you...

You could say that. But that means we don't have any quants or traders in our 'trading' firm :). I think a better way to put it is that the research and strategies that I use to trade aren't applicable across longer timeframes, and I wouldn't be able to economically replicate the resources I...

I don't know much about trading as a whole, and in particular the type of trading that 'independent trader' typically entails (holding periods longer than milliseconds). The only way I know how to 'trade' is to make markets, in which case my edge is that I'm getting paid to provide...

There are lots of reasons, none of which are due to overpricing or odd supply/demand issues. One of them that you might not consider is capacity. A fiber line can carry enough bandwidth to sell to many firms. Microwave capacity is very limited and needs to be allocated relatively sparingly. As...

I'm not sure how the exact logistics work, but I've never heard of large volumes themselves being an issue with Accounting. PNL is very straight-forward for liquidly traded products - just stick it in a database and add up buys and sells more or less. There's some minor issues here, but they...

No, I think there is still value in intraday/swing trading, just not tick-by-tick trading/scalping that manual traders used to be able to do.

I think I'm overextending myself trying to estimate what those bare-bones firms really specialize in. But I think a key barrier for them is the lack of top-notch inter-colocation connectivity that is required to successfully do HFT in equities. Microwave lines between all of the protected...

Really depends on the situation. Most traders/quants these days do most of their own coding, with a software developer maybe to make performance enhancements to the code. Then within a team or firm there's a few trade operators monitoring the algos making sure nothing goes wrong. The idea guys...

Yeah I'd say 5M is a typical minimum for most larger firms to start taking someone seriously, maybe a little less if their resource requirements are minimal or line up cleanly with what's already available. A lot of the bare-bones firms like HTG are really hesitant to delve into the HFT...

1) Inexperienced: CS/Math undergrad and/or post-grad from top school and unanimous passing of panel interviews. Sucks but that's just the way it is. There's so many qualified applicants it's just terribly hard to stand out otherwise. If you had something extraordinary technological achievement...

Direct from exchange, period. Filter out what you need for live trading, record everything, keep anything you need often easily accessible and archive the rest for future use.

Maybe I'm being naive but it doesn't concern me. They certainly can't step in front of my order or fill/reaction since I'm connected directly to the exchange with no intermediaries. In theory they could push certain positions against me (like a index vs. futures spread) but a) it's probably not...

I'm not personally since I feel I have bigger fish to fry on limited resources, but I could see other firms/guys taking a stab at it for some limited PNL if their systems easily support connectivity there.

You just rewrite what you already know. It varies a lot. For a place like Getco, since they provide you with so much infrastructure to plug into, their payouts are way lower. I don't know exactly what it is but I'd expect in the 10-30% of your PNL range. Base salary even varies between hires...

+1 And it's even harder/impossible when it's $500M or larger as many hedge funds employing different types of strategies are.

+1

1. I'd recommend FIX since it's easier and will probably save you some work connecting to multiple exchanges. Since you don't have DMA, you don't care about speed anyway. Better yet, write to your broker's API and let them handle all the custom interactions with each exchange themselves. 2...

Whew, good thing I don't have a PHD.

I'm definitely not acting on behalf of my company. I am in part doing it as PR for HFT. Kind of started on a whim to see what kind of views were out there from real traders as opposed to just the media and dispel some myths about how HFT's supposedly cheat everyone. At this point, I'm just...

1) Yes. Infrastructure meaning hardware, trading capital, exchange memberships, network lines, historical data, etc. You get some basic software like exchange connectivity and market data. You bring the software that does the trading logic. 2) Capital backing just means you trade with the...