CME Fined Trader $55,000 for ‘Spoofing’ Treasury Futures

[syswizard]

What Nav was doing is what any of us can do, provided we are good enough, but 99.9% of traders arent. So i dont class what he was doing as abusing the level playing field of the markets. He built it up himself. Good on him I say.

I'd love to talk to Nav some day. Road trip to London anyone ?

 

[IAS_LLC]

What Nav was doing is what any of us can do, provided we are good enough, but 99.9% of traders arent. So i dont class what he was doing as abusing the level playing field of the markets. He built it up himself. Good on him I say. I wish that level of success on every trader

This brings up another point... the CFTC needs to make concrete rules on what spoofing is/isn't. Seems like there is too much room for interpretation right now.

 

[i960]

Anyone know what this is about? I've noticed it semi-often in certain situations (I do see it more often in GBP, like real often) and it seems to me like price trying to be held in place to either ping pong back and forth or for some other reason (the two larger bid and ask levels with non-coincidentally similar counts). Is it sanctioned MM'ing or something else? Maybe somebody with more knowledge knows what's up.

(trade was a failure btw)

 

[dealmaker]

I'd love to talk to Nav some day. Road trip to London anyone ?

No need for you to travel to London, he'll be in US shortly and he'd love for you to visit him in jail though unless convicted, I doubt he'll share any of his methodology, tacticts etc.. I am in agreement with the earlier post, spoofing was only one of the many strategies he used.

 

[i960]

I regularly do hundreds of cancels a day if working autospreader orders. But these are often >20 ticks from market and have no influence on the market.

Also a lot of spoofers I know do it manually not fancy algos (although I'm sure a lot are computer driven) so I'm not sure I agree with the 'level the playing field' comment. Most traders have access to these tools

tommo, this brings up an interesting point per our earlier discussions on cancellation fees and how those may affect spread traders. Perhaps the solution is somewhat of a compromise in that cancellation fees apply only to orders that are near the visible book by some n amount of ticks. That way people who are autospreading and not affecting the market directly are less affected and those manipulating the market are more affected.

I do realize we're all capable of taking advantage of spoofers and the like - but we gotta admit if there were no regulation it would be completely out of hand.

 

[tommo]

tommo, this brings up an interesting point per our earlier discussions on cancellation fees and how those may affect spread traders. Perhaps the solution is somewhat of a compromise in that cancellation fees apply only to orders that are near the visible book by some n amount of ticks. That way people who are autospreading and not affecting the market directly are less affected and those manipulating the market are more affected.

I do realize we're all capable of taking advantage of spoofers and the like - but we gotta admit if there were no regulation it would be completely out of hand.

Hi i960,

Yeah I could go with that. Consistently cancelling orders close to bid or offer would be a compromise I would go with for sure. Although... I would have a caveat that a cancelled order is only counted if you pulled your order without the market moving. Say the current market is 61@62 and I am bidding 60's. Then the market goes to 62@63 and my autospreader cancels 60's and moves to 61's I have effectively cancelled my order at 60's and moved it to 61's but quite clearly it is just moving with the market. Moving bids up in a rising market is a function of any free auction process.

However, regarding your second paragraph I honestly think if the market was full of spoofers who had free reign to spoof as much as they like the market will kill off their edge. If everyone spoofed even the most brain dead trader would quickly cotton on to the fact that all size is there to be hit because they don't really want the fill. Spoofers would get destroyed and die out. I see free markets as natural selection, too much of one thing causes a distortion and will rebalance itself.

 

[syswizard]

Yeah I could go with that. Consistently cancelling orders close to bid or offer would be a compromise I would go with for sure. A

That's another great idea...and easy to implement.

However, regarding your second paragraph I honestly think if the market was full of spoofers who had free reign to spoof as much as they like the market will kill off their edge. If everyone spoofed even the most brain dead trader would quickly cotton on to the fact that all size is there to be hit because they don't really want the fill. Spoofers would get destroyed and die out. I see free markets as natural selection, too much of one thing causes a distortion and will rebalance itself.

Totally disagree. Spoofers are in the trading battle with bazookas....against "free market" traders with pea shooters. They'll never die off.

 

[syswizard]

he'll be in US shortly..

When exactly is his extradition hearing date ?

 

[Stock]

LOL, so what, he gamed the system and faked out your bots. This is the game, within the rules, stop complaining because you're too stupid to capitalize on it.