Automated Trading Seen Dominating Futures Markets by 2010

The article refers directly to the Chicago pits and how the smaller traders in there have struggled to compete with the resources and technological approach to this business by the institutions.

When I mention arcades closing and traders quitting I am talking about those trading bonds,notes,bunds,euribor etc.

I am not making it up for effect,it's something I've noticed actually happening,a while ago the WSJ published an article saying the top 3 traders in Euribor future are computer models and it has never been denied.

If you want to position take in FX,DOW,DAX etc etc then best of luck,it of course can be done and I would say now is the only way to trade these markets,scalping for a tick is a big waste of time and has been for some time.

At least people are wising up to it but the worst mistake everyone can make is to under-estimate these fucking nuisances with their algo-models and dismiss them like a load of idiots.
 
Quote from nazzdack:

No. Good traders will always be able to make money. The algorithms and black-boxes should cannibalize themselves because they'll tend to want to do the same thing at the same time and their rates of return should cluster slightly below the benchmark, just like index funds.
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You promise, nazzdack ? :)
 
I find it interesting that no one is even talking about what has happened in other markets (i.e. Options and stocks). Those who adjust will survive and those who refuse to believe in Technology changing the markets have no understanding of History. Pit trading like Specialist (in stocks) are part of the changing evolution of investing and transferring of risk.These systems have only been in place for just a small blip of economic history. They were the creation of an evolving market and they too will fall to the wayside as the markets change and grow with the technology that makes them.
 
This is a poorly written article. It implies that AI is going to take everything over. Everyone has been hearing about this for 100 years.

Besides I want to see what the global financial system looks like after we get through the current situation. Or if we get through it.
 
Quote from JamesVU2000:

This is a poorly written article. It implies that AI is going to take everything over. Everyone has been hearing about this for 100 years.

Besides I want to see what the global financial system looks like after we get through the current situation. Or if we get through it.
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If there's one conclusion I've come to, it's that you can have all the fancy high speed cpus, sophisticated AI, genius level TA alrgorithms, and none of them mean squat compared to client and institutional order flow. I'll take a monkey's analysis + order flow over all of that sophisticated stuff any day.

The level of information integration and order flow plus deep pockets is always an edge for the house, always has been, always will be, how they process that information is just another more efficient manner of adding bells and whistles.
 
I'm not worried. I remember those predictions that computers would do away with paperwork. The reason Goldman Sachs has to use all these alogo's and quants to trade is because they can't hire enough people who can trade profitably without those programs. It takes too many years and too much experience to learn how to trade. I'm not concerned in the least that computers will replace the human brain by 2010.
 
That article is stupid.

People never change. Bots can execution human intentions but not the natural liquidity patterns markets have. The skilled little guy - or big independent individual trader guy - will always be able to compete in electronic markets.
 
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