Forbes article of interest...

HFT's provide liquidity. Which I think is great for when I want out.

However, I also see that HFT's minimize volatility which decreases my probability of executing really great intra-day trades.

In other words, HFT's limit my reward while keeping the risk the same. Diminishing Returns.

HFT's aren't helping my bottom line as I look forward to illiquidity.

Elwood
 
Quote from Maverick74:

Don, we've debated this before and I still disagree with you about it. Isn't your avg holding time at Bright now into the weeks? Why do you care about micro structure so much? I continue to struggle why this is an issue for your firm. The truth is, these HFT's guys are eating each other, not the masses. They are putting marginal HFT firms out of business. There are far bigger fish to fry then this in my opinion.
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I asked the author of the article to respond to you, and he agrees...gee, you must be one smart dude, LOL

"I agree with his points. In the article we are simply talking about how we have adjusted to the new environment by lengthening our time horizon. You can't scalp in an HFT world, and our traders know this. We are simply sharing that information with the public.

The bigger fish to fry is internalization, and how it disadvantages the passive liquidity provider. That is our major area of concern. "


Donald R. Bright
Bright Trading, LLC
www.stocktrading.com
 
Quote from Don Bright:

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I asked the author of the article to respond to you, and he agrees...gee, you must be one smart dude, LOL

Donald R. Bright
Bright Trading, LLC
www.stocktrading.com
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I get that a lot. :D
 
Great article. What economic value do these HFT firms have? This is not silcon valley. They are also not engaging in an orderly transparent market. I wish the HFT a swift demise as they are a huge waste of human and real capital. Hopefully they will self destruct. They make their money by pretending to provide liquidity but they admitted to running away from the flash crash. They provided zero liquidity then. They reap the benefits of of being a market maker without taking on the risks. It is fundamentally unfair. Karma will get them though I won't cry when they complain they lost money trading. Nope not those guys.
 
Quote from Maverick74:

Don, we've debated this before and I still disagree with you about it. Isn't your avg holding time at Bright now into the weeks? Why do you care about micro structure so much? I continue to struggle why this is an issue for your firm. The truth is, these HFT's guys are eating each other, not the masses. They are putting marginal HFT firms out of business. There are far bigger fish to fry then this in my opinion.
More...

Maverick is 100% right on this. I think HFTs provide more value to the market than they remove. Especially since we keep hearing the BS that grandpa's 300 shares of IBM that he's held since 1988 is somehow at big risk because of high-frequency traders. HFTs are a zero-sum game. There are winners and losers as a result of HFTs but those winners and losers tend to be the HFTs themselves.

To me, it's just a smoke-screen to keep people from directing anger at the banking system. It's been 5 years since those bailouts and they keep coming in in the form of QE and other mechanisms. It sure does sound intimidating to the average Joe though "Your 401k is at risk. You must act now". There's political banter on both sides of the isle on the issue but at the end of the day, there's no way to substantiate those claims aside from one or two isolated incidents in which the cause was never even properly identified. It's just a smoke screen to keep funding the big players' bets on the backs of everyone else.
 
---Mr. Dick: HFT’s are the new market makers without the traditional affirmative obligation of designated market makers to keep markets orderly. When uncertainty enters the picture, they cancel their orders and liquidity disappears---

i've been saying this (here,on ET) for many many years. but people think that i'm a lunatic or something. they still believe that HFT thing is kosher and actually good for ya. it's not.
that flash crash committee was comical(or should say-scary?) cause after 2 years they can't figure out the cause. i told you what is the cause few days after it. this is a perfect demonstration of who you have in charge in DC. russian school drop out can figure this out in 2 days and they can't figure it out in 2 years. boy oh boy...what pisses me off the most-is that they do have job and i'm not

this sentence above is a clearest possible demonstration of to whom the SEC is actually working. they should be jailed,for passing and adopting such dangerous and unfair(subpenny ,anyone?) structure.what is going on in this field is exact same s** that is going on IN EVERY SECTOR OF US ECONOMY. that why i never believed in any recovery. it's a huge pile of BS that keeps coming from DC. there is will be no recovery. NEWER, until all of them are kicked out of DC. ALL OF THEM.
 
Quote from Maverick74:

Don, we've debated this before and I still disagree with you about it. Isn't your avg holding time at Bright now into the weeks? Why do you care about micro structure so much? I continue to struggle why this is an issue for your firm. The truth is, these HFT's guys are eating each other, not the masses. They are putting marginal HFT firms out of business. There are far bigger fish to fry then this in my opinion.
More...

Mav

I thought u where trading at Bright ?
Not anymore ? Why?
 
Quote from dealmaker:

HFTs do provide liquidity but for whom, individual trader trading 1k to 2k shares rarely had too much difficulty exiting...
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one more time-HFT is a VERY BROAD field. it's NOT some very specific algo with certain rules, that just sits on bid and ask and making market based on whatever. there is hundreds of different games that might fall into a HFT category(holding the stock for a very short period of time)
 
check out this nimwit - http://money.cnn.com/video/investin...-speed-trader-secrets-hft.cnnmoney/index.html

Yes, quote stuffing exists but so does insider trading. Those things will not ever cease to exist simply because of penalties or regulations. this guy seems more like a disgruntled employee than anything else. but the lovely CNN presents him as "High speed trader turned whistleblower David Lauer explains why he left the industry and how certain practices at computerized trading firms negatively affect the markets."
 
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