HFT - If You Commit The Following Your Company Is Finished
- Thread starter THE-BEAKER
- Start date
Not sure what the context of your post is...The thread's assumption is that HFT is a profitable endeavour and driving away prop traders.
You seem to argue that markets are uncorrelated and algo traders are somehow full of it.
Both can't be true.
If you need proof that quants can make money, please read the following:
http://en.wikipedia.org/wiki/Medallion_Fund
James Simon has returned >35% CAGR since '89...AFTER his management fee.
Not sure what the context of your post is...The thread's assumption is that HFT is a profitable endeavour and driving away prop traders.
You seem to argue that markets are uncorrelated and algo traders are somehow full of it.
Both can't be true.
If you need proof that quants can make money, please read the following:
http://en.wikipedia.org/wiki/Medallion_Fund
James Simon has returned >35% CAGR since '89...AFTER his management fee.
most of us here are saying that because of hft and other 'technics' such as subpenny it's it much harder to make a decent profits in daytrading. while couple guys are claiming that the markets are never been more easier and inefficient..one more time-i would like to see proof of that. proof that couple guys out of 100 making killing on retail level and their profits are keep increasing year over year,along with automated trading volume on US markets. that's all i'm asking. Simon operates on totally different level,not comparable with average joe the retail trader( like myself)
btw-i would appreciate,if you can post Simons HF performance for 2007-2012
btw-i would appreciate,if you can post Simons HF performance for 2007-2012
I have said before HFT is causing changes and I like all other such changes, will be eaten by something worse yet eventually (at which point expect the HFT people to squawk about unfair practices), I have to support Clubber's comments completely.
Clearly a national fair price can't exist where legislators allow one group (Deep pocket, co location, politicians) to get fills that most market participants CAN'T get while the captured regulators stand idlely by "studying things". These permitted cheats are impacting the entire market and like fish in the sea, when the little guys are all gone, soon after the big guys will be all gone as well. That is what zero sum means isn't it?
Market makers have the spread and price setting advantage. Why do they need the advantage of front running as well? The precise mechanism that they use is kind of moot. Clearly no one is playing a fair game when some players don't lose more a single day in a quarter. In a statistical universe, what are the odds of that happening quarter after quarter without something clearly wrong in a fair price?
The old days when market making allowed for some to detect monkey business and punish market makers sometimes, have changed to if no co-location and the right connections, no money for you!
On top of that, many little quys get their houses taken away, big guys get their bonuses paid (in some cases by the legislators), none of them end up in legal trouble for practices that seem fraudulent. Little fish are leaving the market in droves and far fewer are coming in to feed on.
Of course all of this will lead to a better world. In the end times of massive societal changes, corruption continues at the same rate as always, but nothing happens until the big bang comes. This is just a sign of massive legalized corruption in my view.
I had an interesting conversation with a former Vancouver BC prop trader who said after years of doing quite well, the methods he was using began failing spectacularly in fall 2011. He blew out his account and is now out of the business and disgusted with the whole trading scene.
My thought was that HFT provides false liquidity in the markets. We agreed that prop traders doing 250000 shares a day are sitting ducks for HFT algos that can sniff out orders faster than they can click a mouse.
Also, I know many day traders who have given up in the past few years. Is this what HFT has done - remove prop traders and along with it some more true market liquidity?
If so, then the true liquidity depth may be much worse than it appears. Thoughts?
My thought was that HFT provides false liquidity in the markets. We agreed that prop traders doing 250000 shares a day are sitting ducks for HFT algos that can sniff out orders faster than they can click a mouse.
Also, I know many day traders who have given up in the past few years. Is this what HFT has done - remove prop traders and along with it some more true market liquidity?
If so, then the true liquidity depth may be much worse than it appears. Thoughts?
----My thought was that HFT provides false liquidity in the markets.---
i've been saying this for years. yes, it's all fake and all liquidity will disappear,when you try to hit it. and this is exactly the cause of flash crash..no need genius or some special committee or extensive SEC 'research' that they been doing for years..8th grade school drop out from some foreign country can see it and SEC can't..pathetic
as been pointed above and many times before this thread-current rules and regulations for US markets(specially stocks) have zero transparency,favors few WS firms and tilted totally against any retail trading. imo-with the goal to kick out ALL of us. and so far-they succeeded. you don't even have to trade to see it. it's clearly visible by this forum activity. day trading is dead
i've been saying this for years. yes, it's all fake and all liquidity will disappear,when you try to hit it. and this is exactly the cause of flash crash..no need genius or some special committee or extensive SEC 'research' that they been doing for years..8th grade school drop out from some foreign country can see it and SEC can't..pathetic
as been pointed above and many times before this thread-current rules and regulations for US markets(specially stocks) have zero transparency,favors few WS firms and tilted totally against any retail trading. imo-with the goal to kick out ALL of us. and so far-they succeeded. you don't even have to trade to see it. it's clearly visible by this forum activity. day trading is dead
I also observed some strategies stop working as well in the fall 2011 too. The default action when there's mostly just HFTs trading stocks back and forth can be tricky to trade. Perhaps larger market participants started adopting a 'wait and see' approach in terms of the economic fundamentals so didn't feel the need to either buy too aggressively or sell too aggressively, which left HFTs in control of more stocks each day.
All you can really do is come up with additional strategies that work well for the kind of market we're in and keep the other strategies in reserve for when they start working again.
If you can survive the tough times the upside is that there will be fewer humans competing with you if things get easier again.
Exactly. Wall Street casino.
I'm seeing a widespread move away from investing to saving, where saving is either through debt reduction or plain old money under the mattress.