hey HFT scum, yeah, you. Watch this

[walterjennings]

Quote from killthesunshine:

amzing how you backed off all your talking points

I'm unpredictable like that. And I thought there was a nice analogy in there about electronics having faster reaction times and more stamina when it comes to getting a job done more efficiently than humans

 

[ammo]

Quote from ammo:

So, are you paying for the information or not,and if not ,why?And if yes,do you still feel that the value of your providing liquidity ,outways all the customers getting fills a few cents above or below where they normally should,and if you asked these customers with the bad fills which would they prefer,do you think there would be an outpouring of gratitude for the liquidity that was graciously bestowed upon them?

care to respond

 

[killthesunshine]

Quote from asiaprop:

wow someone took the time to address a lot of points, I appreciate it.
But I still beg to differ on a lot of points. The text got too long so i refer directly to your points in the previous post.

1) I never disagreed with that definition in the first part. But this thread is about HFT something a normal retail guy cannot do, thats WHY we have this discussion about unfair markets. Thats why sub min should not be included.

2) Lol, you may have a slight misconception why you get paid a rebate. Its because you stick your head out not because you add liquidity. Adding liquidity is offering a tradable assets in the market. You offer them, turn around and bid the very same shares a second later. Of course do ECNs define what you do as adding liquidity otherwise they would contradict what they say when they lobbied industry regulators to start this stupid game.

3) You contradict your own point 5). Either its cheap to start up to compete or not. Chose one. And again you use a very twisted argument to make your point. My whole argument is that the parties involved only derive a benefit while pulling pennies out of everyone's pocket BECAUSE they play and unfair game (more below what I mean with that).

4) It would all be fine if I could also sub-penny with any of the retail brokers of choice. I cannot and nobody else in retail space. I really think you do not fully comprehend what a transparent market place is and why its so good for the broad majority of price takers as well as price makers. Its because it bestows trust and equal opportunity something everyone wants to return to do more business.

5) Show me one single HFT which started up operations below 100,000 USD. The complete setup. YOu dont make money by renting a server rack, right?

6) Really? So how come I get raped each and every single time I put in a limit order to get into a long-term position. I dont even dare to trade market orders on any < 5billion market cap stocks because a lot of offers get miraculously pulled although they just showed up on the screen. Buddy, I trade for over 10 years institutionally and personally please dont tell me I dont know how to execute orders and what I am seeing on the screens.

7) Look above, the co-located data feed alone costs more than most can afford. Buddy again, this is not just about start up cost, my argument is about unfair practices in this industry. Orders that get pulled should NEVER be allowed. At least not those orders that get pulled because another counterparty took a glimpse at my order right before it hit the market.

8) First of all my simple answer: I serve the benefit of being a risk taker. I am willing to take risk which others in the market want to offload. Secondly, please do not mix up everything. I dont have any issue with high frequency trading in itself. Thus I also dont care about people arbitraging the market. Its not good for me because most arb opportunities are gone. But why not, I could do the same you are absolutely right. BUT I DONT WANT TO HAVE TO INVEST 100K + JUST SO THAT I DONT GET FRONTRUN BY SOME OTHERS WHO THINK THEY ARE PRIVILEGED MARKET PARTICIPANTS. Last time I signed the exchange agreement I was promised orderly markets with all participants seeing the same I see. This has obviously changed. So if such parties cannot regulate themselves then I suppose we need to impose regulations to return to a fair and transparent market. Very simple.

9) Lol, you again twist my argument. My point is that even a limit order wont work because someone else frontruns my bid a 0.1cent cheaper. For arguments sake (I dont trade penny stocks myself) if I bid for a stock priced at 1 dollar I dont want to bid a whole percent lower but if I had the chance I would love to bid 0.1 cents lower to get my stock. At least I want the same opportunities than someone else in the market enjoys. Simple as that.

10) Yes I know you rent 150 dollar servers. YOu get your co-located data feed thrown in by your dad for birthday (worth several thousands alone), and because you are such a whizkid you code up a industry stealth app in over the weekend, something which took Goldman alone several years to develop and many million lines of code. But hey , you seem to be pretty big mouthed I almost believe you ;-)

11) You deny that moving orders around affects every price taker equally. I cannot say more than that but that it shows your ignorance or lack of knowledge

12) Thats what we pay for, as price takers, to trade or not trade. Market makers get paid to stick their head out. You do the opposite: You pay to get an unfair peek at prices that nobody else gets to see. You also pay to front run others. Hmm, I actually dont care how you feel about yourself but I hope that the door will be slammed in your face asap, and I am pretty sure legislation is on the way to have this pathetic loophole closes soon.

13) As mentioned I dont see tighter prices in volatile markets. And spreads were already way tight enough before the first HFT started operating. No need for you guys to be honest.

14) Dude, you know exactly why some ECNs, including BATS were given the heat recently dont BS around pretending you dont know what is going on. You come across as being too smart for that.

15) goes back to my first point. Precisely, HIGH-FREQUENCY, which every professional will attest you does NOT include sub min trading. But you could start introducing the term Ultra High Frequency maybe you make your points clearer, though I doubt it.

16) Yes we have seen what happens in volatile times. Nobody adjusts they reduce liquidity to the point of completely shutting operations. And I talk about spreads in commodity futures, options, index options/futures, stocks, you name it.

17) speaks for itself

18) sustained market moves are caused by risk takers entering the market, not because of arbitrageurs or HFT. If you contest this point then I dont even know where to start. Seriously!!!

Buddy, I understand you want to keep on collecting your bread and butter but I think you should consider your days counted rather than convincing the world is wrong, LOL. You can argue as much as you like but fact is that HFT is still littered with unfair, unequal, and sometimes outright illegal activities, all of them I have outlined above. There is a reason why BATS and Co are under regulatory investigation.

address these points please, mr REBATE. each in succession.

care to respond?

 

[tgtrader]

Quote from asiaprop:

that is utter crap. It was HFT, look at all the fx crosses, look at all the stocks, look at european index futures, look at all the US indexes. This was an industry wide sweep where every last computer that was still linked to the game executed sell orders because sell levels were triggered.

This didn't happen all at once... FX markets started moving in a big way prior to equities/S&P futures massive sell-off. After that began, the market execution sweep order (supposedly from BarCap) hit the S&P futures (starting at around 1100 level, perhaps a bit below). As the S&P sold off, so (logically) did the Dow and other index futures because of the interconnected nature of the global system. The rapid drop to down 1000 (granted, from down a few hundred points to start), which I am specifically speaking about in my prior post, can largely be attributed to the S&P sweep. In terms of stocks, despite all the media hype about a fat finger execution in stocks like Accenture and Proctor and Gamble causing the sell off, those stocks did NOT sell off dramatically until AFTER the bottom on the S&Ps (and we're talking a few minutes here, not seconds).

EDIT: To confirm, I agree that stops/sell levels were triggered in a big way, thereby increasing the sell-off across global markets. However, this was (again) not HFT's fault... for a stop order is not only utilized by HFT strategies but also automated strategies. In fact, most HFT strategies (again, logically) trade so fast that they will avoid market sell orders because the chances of an asset moving significantly over the time frame they are trading is very, very small. Unfortunately we'll never know for sure, but I bet there were more stop market orders triggered by computers (but not HFT related) vs. HFT strategies.

 

[science_trader]

Quote from ammo:
So, are you paying for the information or not,and if not ,why?And if yes,do you still feel that the value of your providing liquidity ,outways all the customers getting fills a few cents above or below where they normally should,and if you asked these customers with the bad fills which would they prefer,do you think there would be an outpouring of gratitude for the liquidity that was graciously bestowed upon them?
care to respond

As far as I can remember investors were paying more (i.e. larger spreads) before? Wasn't the spread something like 1/16 back in 2000? Wasn't it Island ECN and more generally computerized markets that brought smaller spreads? from 1/16 to 1 cent, it looks to me like a factor 6... so who cares who is on the other side! When will all these dumb NYSE market makers understand that their job is better done by a computer and that their only existence is justified only to produce noise on CNBC?

 

[asiaprop]

well to be honest I still beg to disagree. This was not an somewhat orderly crash like in 87. This was a complete malfunction of the system. And I think the linkages between the exchange pricing feed and ECNs was completely messed. That some ECNs dry up in volatile times is understandable but that orders are routed to the ECNs during that time just because execution at the NYSE or NASDAQ was purposely slowed down does not make any sense. That only proves my earlier point that you dont set up a HFT and also execution algos with a few lines of code. The problem is the same than what we had with CDOs. Most quants had not the slightest ideas how those vehicles perform under stress, and how the risk can be managed. Now, most of the CS boys from Cornell and Co were told to play their magic hands without knowing the least about mass psychology, markets, and asset prices under different scenario stress tests. I am very certain that so far NOTHING has been done to avoid what has just happened a few weeks ago. The same could occur again.

Quote from walterjennings:

I was thinking it was a coupling between extremely thin liquidity due to volatility, mixed in with a lot of stops being executed, margin calls, and band wagon shorts hopping on for the ride (who eventually got burned).

 

[asiaprop]

I dont think he dares to, he was hiding too long behind his definition umbrella.

Quote from killthesunshine:

address these points please, mr REBATE. each in succession.

care to respond?

 

[science_trader]

Quote from killthesunshine:


6) Really? So how come I get raped each and every single time I put in a limit order to get into a long-term position. I dont even dare to trade market orders on any < 5billion market cap stocks because a lot of offers get miraculously pulled although they just showed up on the screen. Buddy, I trade for over 10 years institutionally and personally please dont tell me I dont know how to execute orders and what I am seeing on the screens.

address these points please, mr REBATE. each in succession.

care to respond?

First, may I suggest you change your broker? Second, working for an institution is frankly speaking NOT a reference. Third, may I suggest you go for retirement too?

 

[asiaprop]

another kid who believes he knows the markets. The street is littered, welcome to the club. No its not a reference but it gives me the insight of having traded many more million shares than most other self-proclaimed gurus. It forms the basis of me saying that spreads in effect are not tighter after HFT joined the fray. And what are your qualifications or at least points you try to make?

Quote from science_trader:

First, may I suggest you change your broker? Second, working for an institution is frankly speaking NOT a reference. Third, may I suggest you go for retirement too?

 

[ammo]

Quote from science_trader:

First, may I suggest you change your broker? Second, working for an institution is frankly speaking NOT a reference. Third, may I suggest you go for retirement too?

if they regulate and enforce the reg's before this market is destroyed,you will have to learn to trade,right now you're no more than a cashier working for the supermarket,by that time there will be so little left of you ,doesn;t seem there is much left now,that you will have passed up your chance to learn how to fish and keep yourself feed for life...good luck with that attitude