Another example of HFT "bad behavior"

Discussion in 'Trading' started by ronin266, Jul 19, 2012.

  1. At 10:06:29 yesterday morning, an institution sent a sell order for approximately 14,000 shares, causing the stock of AHGP (Alliance Holdings) to fall $1.44. One minute later it appears the same institution sent a buy order for a similar amount of shares, causing the stock to spike back up over a dollar. An OTC market maker was quick to capitalize on the opportunity.

    How HFT never loses an opportunity to get suckers money. Taking it from us :D
  2. Two things:

    First, you are talking about buy & sell orders that are over a minute apart based on an error by a firm.

    Second, you are talking about OTC which by definition is not electronic nor participates in HFT.

    From the link you posted: "Again, this is all just derived from the tape, so there is no actual proof that this occurred in this situation"
  3. well, i´m not gonna fight about semantics here. But a situation where liquidity drops in a couple of seconds, and after that a big print occurs at a darkpool a fraction of penny above an existing bid, and then the situations repeat itself isn´t an example of a good and fair market, as far as I know.

    Remember, that situation occurred in matter of seconds, tell me that a human MM/dealer will have the speed to calculate the possible market impact of an unexpected order and execute it so flawlessly profiting from it 100% lol.
  4. From the link you posted: "Again, this is all just derived from the tape, so there is no actual proof that this occurred in this situation"
  5. zdreg


    the market maker has his own algorithm.

    don't cry me a river for the MM, they would sell their mothers for a teenie. nowadays for a penny, actually a fraction of a penny.

  6. Someone was off their market and got sniped.

    Happens everyday.

    You can do it with an excel model... nothing HFT about it
  7. From Martin Schwartz in The Market Wizards:

    ... Also, I hate the specialist system; they are always trying to con you to death. I'll give you my view on specialists: Never in my life have I met a less talented group of people who make a disproportionately large amount of money relative to their skills. Having the specialist book is the most extraordinary advantage one could ever ask for. In normal markets, the specialists can always define their risk. If they have a bid for 20,000 down they can buy the stock, knowing they can always get out lower. So, they are protected. I always tell my friends to have their daughters marry the son of a specialist...
  8. zdreg


    lucky luciano, the gangster, once visited the floor of the nyse and after watching the action on the floor was quoted as saying I joined the wrong mob.

    does it still apply with existence of dark pools?
  9. Specialists at least gave you an idea about their plans and you could always trade with them :D.