Pennies into billions, another HFT article.

Discussion in 'Wall St. News' started by S2007S, Oct 10, 2010.

  1. S2007S


    Week after week articles of high frequency trading continue to spread across the internet. Anyone who thinks this kind of trading is going to continue better think twice. Why the sec is waiting what seems like forever to do something about it is beyond me, you can see that this has become a game and the one with the fastest computers wins. From quote stuffing, phantom volume, flash phony trades and what ever else they fucking do to manipulate the game that's being played isnt going to last. Remember nearly 2/3 of the volume on the exchanges are made up of high frequency traders, what ever they tell you about providing liquidity and what ever else they do are fucking lies. This is going to be a significant news event in due time.

    Trading Pennies Into $7 Billion Drives High-Frequency's Cowboys

    Bloomberg October 6, 2010 04:00 AM

    Wednesday, October 6, 2010

    Oct. 6 (Bloomberg) -- A cowboy-hat-wearing robot with "Sell" emblazoned across its chest adorns a wall-length mural in the lounge of RGM Advisors LLC in Austin, Texas. Another robot, with "Buy" on it, wobbles toward a green Wall Street sign as two machines tote spark-emitting high-speed cables.

    "We explained to a local artist that we wanted a mural that represented our business, and he came up with the design," RGM Chief Executive Officer Richard Gorelick says in an airy 16th-floor office that calls to mind a Scandinavian design firm rather than a company that trades hundreds of millions of shares a day, Bloomberg Markets magazine reports in its November issue.

    As a cue to RGM's staff of 120 mainly scientists, software developers and information technology graduates that their job is to eke out a fraction of a cent profit on each of those trades, five stone urns in the lobby are stuffed with pennies.

    "It's a lot easier for us to teach really smart scientists about markets and trading than to teach traders about programming," Gorelick, 39, says.

    High-frequency firms such as Gorelick's are the rebellious new force in U.S. securities markets. Armed with algorithms and computers that shave milliseconds off the speed of a trade, programmers, math whizzes and even some former dot_commers like Gorelick have set up shop from Austin to Chicago to Red Bank, New Jersey. These firms don't analyze a company's value or bet on financial news. They use computers to scour public and private markets for deviations from historical prices and leap on discrepancies, rather than betting on the value of a company, currency or commodity.

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  2. Hard to disagree
  3. This subject was covered on 60 minutes last night. Interesting.