Themis Trading: The HFT Whistleblower

Discussion in 'Trading' started by NY0BScalper, Mar 29, 2011.

  1. I've been reading a lot of the Themis Trading blog ( ) lately. Themis Trading is at the forefront of the war against high-frequency trading (HFT). Their blog has many interesting articles outlining why HFT, in conjunction with our modern for-profit exchange model, has resulted in a market whose purpose is no longer capital formation for fledgling new companies and instead is profits at any cost for the exchange and the fast machines.

    I would rather this thread not become another bitch-fest on HFT, where the losers whine about how unfair the market is, the successful guys come along and say "hey I don't like it either but adapt or die," then the successful guys get flamed for being "HFT leeches."

    My personal opinion on HFT - which I'm sure coincides with that of most the successful professionals on this board, is that HFT works to our disadvantage; even if we're no longer trading manually, our algos still can't compete with the speed of the colocated machines. Regardless, the market is what it is, there is some opportunity to trade against the machines and be right, and there are still plenty of opportunities in the market, even with reduced retail participation.

    Again, I'd rather not get into a debate on HFT - there are plenty of threads on that subject. I'm more curious about Themis, who appears to be a brokerage that works with institutional clients.

    As I read through the Themis blog, then their main website, the thought that struck me overwhelmingly was: why would I want to use these guys if I were a large institutional client? Anyone who complains this much about our current market structure can't possibly be working within it to get the best possible fill.

    One could argue that Themis is excellent with execution, and the limitations of their abilities are the profits of HFT machines. Other brokers don't bring these issues up and instead quietly sell their orderflow to Citadel; Themis, on the other hand, has their clients best interests at hand and fights for it. Personally, I don't get that impression.

    On the page of their website titled "The Themis Approach," they have this quote.

    "We’ve seen Reg ATS and NMS, the proliferation of electronic market centers, and the conversion of formerly great American exchanges from non-profit organizations into for-profit publicly traded companies."

    Formerly great American exchanges? Getting ripped off by 1/8th (12.5 cents) by the NYSE specialist is worse than getting ripped off for 1.9999 cents by the colocated machines?

    Are these guys truth tellers on the forefront of the fight for the integrity of the American exchanges or simply ludites left in the dust trying to justify their poor executions to their clients?
  2. I wish I never heard the words "High Frequency trading" again.

    Can we start calling it predatory algorithms or something like that.
  3. etile


    For the most part I would assume at these intraday levels most of the action nowadays are bots trading against other bots and other manual traders who are getting front-runned. But like you said, at least the spread is better.
  4. There's a Luddite in the house, but it's not Themis. Guess who.

    Beware those that rail against the railers. They are frequently shills or worse.

    Same argument could have been made against someone who railed against the bandits who pillaged the mortgage market. "They are Luddites, I say. They don't appreciate the good work we do , putting the downtrodden into glorious McMansions"

    Yes, think twice before listening to apologists for the scammers.

    PS I have the distinct impression that the most egregious manipulation (at least the most obvious) of the hft crowd has been stopped. Too much heat, they must have been told, knock off the nastiest stuff, or we'll have to close you down. Think not?

  5. Let's be fair now, non traders, and paid apologists. pick your poison.
  6. fanews


    The exchange and brokers sell that special secret 'information' to their elite 'special' clients.

    The world is NOT fair.

    Don't like the rigged casino con-game, the exit door is their.

    Goldman Sachs: I own this market and make the rules. if you don't like it, get the fuck out!

    The average joe doesn't need to trade or invest in the stock market or the market.

    The average joe needs food and oil and being screwed. Damn wall street and FED o% interest rate is responsible for food and energy inflation.

    Food inflation and energy inflation is a direct cause in riots in the middle east.

  7. Bob111


  8. fanews


    and one other thing

    the economy is 15% unemployment and the fucking banks and fed want housing prices to rise?

    WFT man,,,,isn't the goal is to make housing AFFORDABLE!

    In china, the average worker can't even afford a 2 bedroom apartment because of housing speculation..

    I don't give a fuck about the banks with under water mortgages!

    The 'free market' is best regulator of price no rigged markets. manipulated markets. monopoly and market collusions.

    you ask the seller to give 10% discount on the asking price of the house they tell you to fuck off!

    #10     Mar 29, 2011