Exactly, human nature will break technicals without warning, odd how the inconvenient facts get in the way when it is well documented that institutions were frontrunning LTCM unwinding. On an evolutionary scale RenTec have perfected what LTCM started, as they haven't imploded people behind the scenes are becoming nervous and wanting their IP. Once the algos are 'appropriated' the decay starts, most in an industry do not have the ability, experience nor drive to perfect a strategy and so need to obtain it another way. You can then ask did LTCM fall due to the same fate, questions only a handful will ever know the answer to, and something RenTec wants to eliminate.
Likely there are shady practices. They do have a lot of smart people on board but we don't really know if that's all a cover. Plenty of businesses use fronts to look respectable.
My perception and intuition is they're not dodgy. The culture of the business would be influenced largely by James Simons and he comes an academic background, he's a mathematics professor and codebreaker. He doesn't need to cheat and risk his intellectual edge and business spanning several decades. If he came from a traditional banking or sales background like others that have been convicted or investigated I might think otherwise. They're not competing for investor's funds also, another reason why they probably don't need to cheat.
From what I und from what I understand, Rentech isn't trading HFT (they could but apparently don't). It's clear that HFT margins and capacity are ill suited for their size. I doubt that there are non HFT players that partake in spoofing.
Exactly right. Had they accounted for /understood the distribution of said spread in the tails, they'd likely put less position on when the spread was small and stack a ton on when it was wide. They would have made a killing if they could have traded. Instead, they had to sit on position and got blown out.
lol there are many things that are well defined in trading. The reason it seems so ambiguous is likely the plenitude of poorly formulated "trades" that people believe have "edge". If Rentech is trading arbs (especially large scale and hard to model ones) then it is clear why the make money and can specifically point to said inefficiencies.
Exactly. Renaissance are possibley the biggest victim of HFT. https://www.google.co.nz/amp/s/www....-a-killer-flash-boy-app-and-you-can-t-have-it