If he is not fooled by randomness, he wouldn't be here, he would have attorneys, regulatory consultants, financial consultants advising him instead of asking us random retails. Most of us do not have a personal broker handling our trades, especially if we day trade or trade frequently. Do you have a personal broker?
There is a huge difference between being right, and the ability to proof you are right. It is very difficult to proof because you will never have access to the whole procedure that your orders go thru. And it will be very expensive too. The biggest part of the handling goes thru computer systems. The problem is that you have no idea what goes in the system, what goes out, and what happens in that computersystem. Can you give me in detail what happens with your orders? No, although that is the first thing you need. For that you need the source code of all software used in handling your orders. You will never get that. If even the US cannot proof that Russia intervened in the last elections in the US, how can you then proof that brokers copy you? Or did NOT copy you? Electronic abuse can be very difficult to prove, especially if you use software that is provided by the potential cheater (your broker). Do you know from each piece of software you install on your computer exactly, and completely what it does? No, you don't even have any clue about that. Facebook and Google collect and (ab)use on a massive scale data from their customers, without them even knowing that. Gaussian has the same opinion as you. He posted about abuses that happen on internet. It is about data that is much less interesting financially then copying high profitable trades. He is even worried about that happening. But cheating for big amounts of money would not happen? I would think just the opposite, they go for the big money. Have you never heard about insider trading? That is also forbidden and there are a lot of protective measure so that it would not happen. But it happens. PS I do have brokers. What is the definition of a personal broker? If somebody steals your car at night, you will see it next morning. If somebody steals all the data from your PC, you will never know. And even if you would know, you would probablyt never be able to proof it happened, not to mention that finding who did it is even more complicated.
The brokers are able to see the top traders in their system and take their pick. You may have a system that probably isn't ideal for them right now. What if one day with more experience trading, you developed a strategy that put you among the top of traders? It will be too late to worry then. If something in the future is preventable then it is wise to start now rather than later.
As virtusa and qaz have mentioned, it is very likely that the broker steals the idea. If possible they reverse engineer it to check if the logic flows, if not they will copy it (crowd it), or frontrun it as they sell the order flow to hedge funds. The bigger and the more technologically advanced the broker is, the harder it will be for the retail client to detect this behavior. It is almost impossible for the retail to come up with concrete facts to accuse the broker of such misbehavior. Those who blame virtusa for his small account size are traders with no original idea. Their argument sounds like when Gates had Microsoft starting in his garage he shouldn't have cared about the intellectual properties of Microsoft. Most people who are ambitious and trade, might want to eventually launch their own trading firms or scale up; they have risked time and energy and learning, and they do not want their ideas to be stolen by the rent-seeking brokers. I know that I will get a response that "If I am so delusional then nobody has forced me to use a broker"; but we are all adults and looking for a solution.
Don't think that will ever happen to this newbie. We amateur retails can dream but should understand reality. Just like I don't worry about airplane crash when I flew I don't worry about my broker stealing my signals. But for some of you, if you are that good, by all means. Have a good day and happy trading.
And what exactly would that look like? BTW, I think they have more important things to worry about right now. In fact, I'd say they have more important things to think about all the time! If the do or not is another matter.
they have better strategies than you ,and your account is marked if you are making huge profits. these HFT machines would trade against you since they know you are a 'trader' and your trading strategy. what trading strategy. any trading strategy you have, they know the strategy. these algos people talking about are just market makers with huge amounts of data and buying and selling power. that can move markets. they can crash the market if the feel like it or rally the market. if they feel like it. the rule of thumb is don't try to trade or hold positions overnight if you are trader and trading large. overnight is too illiquid. like a penny stock, it's too illiquid. paper strategies don't work in live markets due to illiquidity issues and HFT
When you believe that the best you can achieve is just a low % return then you have created a low ceiling above you and fulfilled your own prophecy. Don't limit your belief and your potential is limitless. Have a good week.