Impossible to prove. Allow spoofing and the market will take care of the "problem" all by itself. Unfortunately, HFTs cry to the regulators about spoofers because they are so stupidly written even though they are just as damaging.
'picking off' retail traders
- Thread starter HungryMind1200
- Start date
Impossible to prove. Allow spoofing and the market will take care of the "problem" all by itself. Unfortunately, HFTs cry to the regulators about spoofers because they are so stupidly written even though they are just as damaging.
Actually, people are going to jail for doing it regardless if its impossible to prove or not. We aren't on any jury duty to know exactly what evidence was given to send those people to jail.
For example, what if he sent an email to a buddy that detailed what he was doing and that he "knew" or "understood" it was illegal ?
Simply, I doubt that the only evidence they had was just the program. Some other evidence (e.g. written, recorded phone conversation, attempt to destroy evidence during the investigation or whatever) must have been shown.
For example via a different situation. The justice department didn't have good enough evidence against Martha Stewart until one of her best friends spilled the beans (friend contacted the justice department) and told them what Martha Stewart had said to her. In addition, they discover secret (or they hidden) phone logs and a recorded message about her knowing exactly what she was doing and that she "knew" it was illegal.
That's my point, in the case of Mr. Coscia (convicted), we don't know what evidence was presented to the jury. Just the same, we don't know what evidence is stacked up against Mr. Sarao...
Maybe he confided with a friend, maybe there's recorded phone conversations, maybe he sent emails detailing exactly what he was doing, why he's doing or whatever. Thus, I doubt the only thing they have against these people is just a algorithm.
Regardless, the issue is that the big boys regularly do it and they are outing out the little guy that's doing it too especially those little guys with their algorithms that figure out a way to game the big boys algorithms.
Algorithms against Algorithms...100s of million dollar business every day and the little guy wants part of the action.
For example, what if he sent an email to a buddy that detailed what he was doing and that he "knew" or "understood" it was illegal ?
Simply, I doubt that the only evidence they had was just the program. Some other evidence (e.g. written, recorded phone conversation, attempt to destroy evidence during the investigation or whatever) must have been shown.
For example via a different situation. The justice department didn't have good enough evidence against Martha Stewart until one of her best friends spilled the beans (friend contacted the justice department) and told them what Martha Stewart had said to her. In addition, they discover secret (or they hidden) phone logs and a recorded message about her knowing exactly what she was doing and that she "knew" it was illegal.
That's my point, in the case of Mr. Coscia (convicted), we don't know what evidence was presented to the jury. Just the same, we don't know what evidence is stacked up against Mr. Sarao...
Maybe he confided with a friend, maybe there's recorded phone conversations, maybe he sent emails detailing exactly what he was doing, why he's doing or whatever. Thus, I doubt the only thing they have against these people is just a algorithm.
Regardless, the issue is that the big boys regularly do it and they are outing out the little guy that's doing it too especially those little guys with their algorithms that figure out a way to game the big boys algorithms.
Algorithms against Algorithms...100s of million dollar business every day and the little guy wants part of the action.
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True, but my point is that you can't generally judge the "intent" of an electronically submitted order. You know the symbol, timestamp, order quantity, buy or sell, and the party who submitted it and that's about it. Trying to judge "intent" seems laughable and expensive.
The simple solution is to allow spoofing and let the market sort it out. But the HFT powers that be don't want that because their stupid algorithms would get shredded by a stupid strategy.
Agree and I believe that those reporting the stories about those arrested may have implied the only evidence needed is just the algorithm and the trade IDs. In contrast, those actually involved in the cases most likely has "other" evidence.
Lets put it this way, if you're making millions gaming the big boys at their own game...probably smart not to talk about it with anyone (no phone conversations, no emails, no private message, no trading account sharing, no pillow talk...nothing) because it can be used against you at a later date.
It will be interesting to find out what evidence they have against Sarao when it becomes public records once the trial starts to see if he shared some confidential information with someone and that it becomes the key evidence against him.
Anyone who can regularly buy on the bid and sell on the ask and has very low transaction costs can, in a sense, pick off retail traders who, in general, can't do this.