That depends on whom you ask.
Grim future for day trading as a career
- Thread starter Q3D
- Start date
If you think there is an advantage to the interjection of unnecessary middlemen, then more power to you. If you think that unnecessary middlemen should have privileges not afforded to others, then you are their patron saint. Just please don't try to convince the rest of us that you can sprint faster in your winter boots than in your running shoes.
Depending on the market...its estimated that HFT provides 50% to 70% of the liquidity.
Now imagine you remove them in today's market conditions. Going further, now imagine how things can really get manipulated with less liquidity. Its the main reason why they (exchanges) allows them to persist or exist. The exchanges know the numbers of how many traders have left the market with every economic, global or financial crisis since 2000.
HFT is big money for the exchanges that easily compensate for the loss revenue from their other clients that also includes investors.
Anyways, get use to it and adapt. It really is as simple as that because the other 1/2 that's providing liquidity...its only a small percentage of us retail traders.
Trading is tough...more tough than 5, 10, 15 years ago. Yeah, HFT sucks but pretending we'll be more profitable (I know you didn't actually say that) if they weren't here is incorrect.
I say the above because I see too many post online by others blaming their trading problems on either HFT or Obama administration or new technology or Al Brooks.
In contrast, I think HFT should be better regulated (controlled) but keep them here because we need that liquidity.
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Nope, its academic fact.
I completely agree with you. Im talking about guys with no prop or institutional training/ mentor with the same--and limited bankroll---
Without the above, its not near impossible- it is impossible today.
I say the above because I see too many post online by others blaming their trading problems on either HFT or Obama administration or new technology or Al Brooks.
Who says I'm not adapting? Who says I'm blaming anyone for my trading? Since this is a competitive market, I see no reason to advocate for someone else's interest that is potentially in conflict with my own.
It's a good thing we independent day traders who have made a living for years don't know this. It would be a tough pill to swallow to know it's all been an illusion.
I've already posted info about the exchanges and research about the liquidity issue...info that shows HFT providing liquidity and info showing HFT decreasing liquidity. Info about HFT increasing volatility and info about HFT decreasing volatility...
A ton of research out there for both sides of the coin.
Simply, choose any one you wish to believe. I've been around long enough (dot.com days) to see their impact...good and bad. Right now in today's markets...we need their liquidity.
Still doesn't change the fact. You gotta adapt or move on to something else.
Just like all the conflicting research on tobacco years ago?
In retrospect, it would have paid to see who funded what research, eh?