High Speed Trading Unfair To Retail Traders
- Thread starter vingbel
- Start date
http://www.hftradingbook.com/
Product Description
A hands-on guide to the fast and ever-changing world of high-frequency, algorithmic trading
Financial markets are undergoing rapid innovation due to the continuing proliferation of computer power and algorithms. These developments have created a new investment discipline called high-frequency trading.
This book covers all aspects of high-frequency trading, from the business case and formulation of ideas through the development of trading systems to application of capital and subsequent performance evaluation. It also includes numerous quantitative trading strategies, with market microstructure, event arbitrage, and deviations arbitrage discussed in great detail.
* Contains the tools and techniques needed for building a high-frequency trading system
* Details the post-trade analysis process, including key performance benchmarks and trade quality evaluation
Product Description
A hands-on guide to the fast and ever-changing world of high-frequency, algorithmic trading
Financial markets are undergoing rapid innovation due to the continuing proliferation of computer power and algorithms. These developments have created a new investment discipline called high-frequency trading.
This book covers all aspects of high-frequency trading, from the business case and formulation of ideas through the development of trading systems to application of capital and subsequent performance evaluation. It also includes numerous quantitative trading strategies, with market microstructure, event arbitrage, and deviations arbitrage discussed in great detail.
* Contains the tools and techniques needed for building a high-frequency trading system
* Details the post-trade analysis process, including key performance benchmarks and trade quality evaluation
This isn't about paying for a service. This is about the fairness and integrity of the markets.
Ever play Blackjack? Having live data is just like a standard game of blackjack. You pay to play and you see each card at the same time as everyone else. But lets say you can play this new game. Now, whenever the dealer deals you get to see the card before everyone else. What's more, go ahead and have a bet before the card hits the table.
Casinos try try to fight card counters because it costs them money. Exchanges make money from inviting and providing the tools for "card counters" at the cost of the majority of market participants.
From the NY Times article:
Except you can opt-out. like this:
http://www.batstrading.com/resources/features/bats_exchange_dart.pdf
I find it interesting that the people who are the most outraged seem to be the least experienced traders.
Just don't route to places that are letting outsiders see your order flow.
You're missing the point. It's not anything like Blackjack, because you cannot play the game at all without live data. People can and do make great sacks of money using non-live market data.
There is a giant pool of traders out there who trade off of delayed or end-of-day quotes. That market information is free. A smaller pool of traders pays monthly fees for "real time" quotes. That information is NOT free, and the traders are paying to gain an advantage over the larger pool of traders.
So now there is an even smaller pool of traders who pay even more for even faster, shorter-lived information to gain a perceived advantage over both classes for a very specific style of trading.
So what? "They" are doing to you what you are doing to J6P. If it's not ok for them to do it to you, it's certainly not ok for you to do it to the even-slower pool of traders behind you.
I fail to see any rational grounds for being upset about this.
Anybody that would try to compete with bots that have access to prices ahead of time is well... competing against bots that have the book ahead of time... learn to read a chart, play the bigger moves where speed and commish becomes manageable or negligible in it's effects... and stop whining for godz sake. If you are sitting there pounding a keyboard all day and making less and less.. you're a buggy whip maker that needs a sixty unit education in automotive technology... adapt early and as often as necessary...
http://en.wikipedia.org/wiki/Front_running
They are going to need to amend that article.
There was a similar problem in the FOREX market for years where there big players that could see cash order flow, and would use it to trade futures at the CME. That loop was recently closed, I think.
Exchanges have become a complete joke. Want another scam? How about payment for order flow(PFOF) for equity options taking liquidity that the customer never sees? (your broker swallows it whole - extremely profitable!)
http://www.sec.gov/answers/payordf.htm
http://www.theoptionsinsider.com/industry/?id=108
an article from 2000!!!!
http://www.nytimes.com/2000/07/19/b...-payment-for-order-flow-in-stock-options.html
In equities, you _pay_ to take liquidity and get rebated to provide liquidity, as it should be, imo.
They are going to need to amend that article.
There was a similar problem in the FOREX market for years where there big players that could see cash order flow, and would use it to trade futures at the CME. That loop was recently closed, I think.
Exchanges have become a complete joke. Want another scam? How about payment for order flow(PFOF) for equity options taking liquidity that the customer never sees? (your broker swallows it whole - extremely profitable!)
http://www.sec.gov/answers/payordf.htm
http://www.theoptionsinsider.com/industry/?id=108
an article from 2000!!!!
http://www.nytimes.com/2000/07/19/b...-payment-for-order-flow-in-stock-options.html
In equities, you _pay_ to take liquidity and get rebated to provide liquidity, as it should be, imo.