hey HFT scum, yeah, you. Watch this
- Thread starter stock777
- Start date
777,
Why not just widen the time frame, to say, hourly, or go to volume bars?
Is HFT really a threat?
Why not just widen the time frame, to say, hourly, or go to volume bars?
Is HFT really a threat?
That's not the issue. The issue is , there are cheaters in the marketplace. Blindfolding yourself is not the solution.
Here, I have to return these , as my disk drive is full up with them already.
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http://blog.themistrading.com/?p=1323
More and more , the feeble and impotent protestations of the vermin, that all is well, and hft is blessed, are falling on deaf ears.
More and more , the feeble and impotent protestations of the vermin, that all is well, and hft is blessed, are falling on deaf ears.
I guess my issue would be that i would never have heard of HFT if it werent for the good folks here at ET. While I think that it is uncool, the fact is that there are cheaters in everything we do, if you sit down and think about it. In all we do, literally, there are people who either do not play by the rules or try to shortcut them.
How does that affect your personal game?
When I look back on my own charts of the flash crash, I caught most of it. I have no idea why it was happening, but I knew all I needed to know, which is that price was falling at an increasingly accelerated rate.
I get that you are concerned about the mom and pop of the market, but mom and pop can educate themselves with methods like CANSLIM. And they should be diversified anyway, but I digress.
As far as traders go, in real time, except for scalpers, traders had plenty of time to react.
Im not trying to be controversial or argumentative, but I just don't see what the big deal is about cheaters in the marketplace when there are cheaters everywhere you look, and they will always be there.
How does that affect your personal game?
When I look back on my own charts of the flash crash, I caught most of it. I have no idea why it was happening, but I knew all I needed to know, which is that price was falling at an increasingly accelerated rate.
I get that you are concerned about the mom and pop of the market, but mom and pop can educate themselves with methods like CANSLIM. And they should be diversified anyway, but I digress.
As far as traders go, in real time, except for scalpers, traders had plenty of time to react.
Im not trying to be controversial or argumentative, but I just don't see what the big deal is about cheaters in the marketplace when there are cheaters everywhere you look, and they will always be there.
The problem, 777, is that you don't have a thesis to focus your emotions. You are angry, and justifiably so, but you aren't directing your emphatic posts towards anything tangible.
You are causing a ruckus, and throwing your pooh at anyone who tries to help you direct your anger.
The zero-hedge "article" you linked to was written by a dangerously misinformed individual.
The issue is that HFT has become a catch-all. Allow me to add some color:
My company does trading consulting, trading software development, etc. We have a new client that is using an old school broker. This broker told me that their system can only handle 15 orders per second, with an average ack of 60ms--which, in this day and age, is basically sending an order tomorrow. So I kindly told them that our mutual client will need an OMS that can handle at least a hundred orders per second (which is nothing), and they referred me to their clearing firms' HFT division. Basically, any trading firm that sends more than about 20 orders per second is considered a HFT company. Such nonsense.
The HFT companies that the public should focus on are a small, powerful, oligopolistic group. Goldman, Timber Hill, Citidel, Getco, etc... Not some $4 million capitalized prop shop that sends 300 orders per second. Internalization should be the focus of the regulators, not co-location, or hi-speed computers. Throwing shit at any company which uses algo's will only make other trading professionals see you as...well...an ignorant juvenile.
stock777 has stated his stance multiple times. He's against:
1) Co-location
2) Sub-pennying
3) Unnecessary quote activity
My opinions:
1) Co-location does seem shady. It's technically not "front running" because they're acting on public information that they're just happening to see first. Still, the fact that the exchanges are selling a higher speed connection just feels like a slippery slope to me. Pay the exchange enough money and what else will they give you that no one else can afford? Who knows. Obviously there are always going to be discrepancies in how fast people send and receive data, so this will continually be an edge that is exploited, however, I'd at least like to see impartial exchanges. You want to set up shop in the next building over, fine, but stop lining the pockets of the exchanges and giving them incentives to find other "edges" that they can sell.
2) Sub-pennying needs to go, period. Getting a fill is atrocious and getting worse every day. Can't get filled without getting run over 90% of the time, even if you're the first one in at the best bid/offer. It benefits no one other than HFTs trying to profit by scooping up fills and churning rebates. I'd be willing to guess that a broker acting as an agent would probably round a customer's 15.999 priced order to 16 anyways.
3) Quote bombing seems like it needs to be reigned in. How is flooding the market with 5000 quotes a second not considered market manipulation? Sure, they can be hit/taken but most of the time their sole function is to lag up the system or make something look really strong or weak when there is no real intention to buy or sell.
I'm not against all algorithmic/high frequency trading. If you want to set up a program that is "if x, then y...if then z, then q" and run it on 1000 stocks that's fine. It is the picking of one stock and spamming it with a bunch of useless crap that needs to be eliminated.
1) Co-location
2) Sub-pennying
3) Unnecessary quote activity
My opinions:
1) Co-location does seem shady. It's technically not "front running" because they're acting on public information that they're just happening to see first. Still, the fact that the exchanges are selling a higher speed connection just feels like a slippery slope to me. Pay the exchange enough money and what else will they give you that no one else can afford? Who knows. Obviously there are always going to be discrepancies in how fast people send and receive data, so this will continually be an edge that is exploited, however, I'd at least like to see impartial exchanges. You want to set up shop in the next building over, fine, but stop lining the pockets of the exchanges and giving them incentives to find other "edges" that they can sell.
2) Sub-pennying needs to go, period. Getting a fill is atrocious and getting worse every day. Can't get filled without getting run over 90% of the time, even if you're the first one in at the best bid/offer. It benefits no one other than HFTs trying to profit by scooping up fills and churning rebates. I'd be willing to guess that a broker acting as an agent would probably round a customer's 15.999 priced order to 16 anyways.
3) Quote bombing seems like it needs to be reigned in. How is flooding the market with 5000 quotes a second not considered market manipulation? Sure, they can be hit/taken but most of the time their sole function is to lag up the system or make something look really strong or weak when there is no real intention to buy or sell.
I'm not against all algorithmic/high frequency trading. If you want to set up a program that is "if x, then y...if then z, then q" and run it on 1000 stocks that's fine. It is the picking of one stock and spamming it with a bunch of useless crap that needs to be eliminated.
I agree with tradingscrub.
Sub-pennying should be gone, and quote stuffing should be discouraged. Co-location should be more transparent
However, internalization is by far the biggest problem.
I was at a HFT seminar about 6 months ago. To paraphrase an exec from a large brokerage company who was speaking, "No broker is going to show the world its customer order flow, if it doesn't want to...so we might as well discuss the next topic." Internalization should be illegal, and there should be better regulations regarding how a broker should fulfill its fiduciary duty for its customer.
Sub-pennying should be gone, and quote stuffing should be discouraged. Co-location should be more transparent
However, internalization is by far the biggest problem.
I was at a HFT seminar about 6 months ago. To paraphrase an exec from a large brokerage company who was speaking, "No broker is going to show the world its customer order flow, if it doesn't want to...so we might as well discuss the next topic." Internalization should be illegal, and there should be better regulations regarding how a broker should fulfill its fiduciary duty for its customer.