To all of the readers who never placed a 1000 lot order in Mini S&P´s AND actually executed such an order size: do it yourself (if you have the margin account size I have ;=) and see what happens. Actually, spoofing is the easiest manipulation method around because there are other WANNABE algos out there who engage in HFT or scalping or arbitrage (I don´t give a fa.t how you call it) trying to outsmart the big players and make some ticks here and there. You should read the charges carefully: "His offers composed 20% to 29% of the CME’s entire E-mini sell-side order book, the U.S. alleges." If that´s true, then this MOFO deserves to be in prison for lifetime. Full Stop. From a guy who actually trades in 1000 lot sizes - and not just "babbling" about it.
26. As reflected in correspondence with both SARAO and an FCM he used, the CME observed that, between September 2008 and October 2009, SARAO had engaged in pre-opening activity-specifically, entering orders and then canceling them-that "appeared to have a significant impact on the Indicative Opening Price." The CME contacted SARAO about this activity in March 2009 and notified him, via correspondence dated May 6, 2010, that "all orders entered on Globex during the pre-opening are expected to be entered in good faith for the purpose of executing bona fide transactions." The CME provided a copy of the latter correspondence to SARAO's FCM, which suggested to SARAO in an email that he call the FCM's compliance department if he had any questions. In a responsive email dated May 25, 2010, SARAO wrote to his FCM that he had "just called" the CME "and told em to kiss my ass.
yeah, that's probably what the trader they interviewed meant. 60% of the book. Thanks for pointing that out. At anyrate, all I can figure is his algorithm entered a lot of sell stops and cancelled them before they got hit?
No,not sell stops. He put in sell limit orders above the market price. Personally, i don't see what the big deal is. I don't understand how putting a load of sell limits in caused the flash crash.
I think it's a big deal when one does it >22k times in hours. All the other algos are reading this and adjusting themselves / doing the same thing in tandem accordingly. I could be way, way off but that's my best guess. So they all contribute to a snowball effect.
He may be joining Rajat sooner than he thinks.... Supreme Count Declines To Hear Gupta Appeal Apr 20 2015 | 10:54am ET The U.S. Supreme Court will not hear former Goldman Sachs director Rajat Gupta’s appeal of his 2012 insider-trading conviction. There was no comment from the court in the decision. Gupta’s appeal alleged the trial court had failed to admit evidence of his good character and a lack of motive to commit the offense. Gupta was convicted of three counts of securities fraud and one count of conspiracy to pass inside information. Galleon Group founder Raj Rajaratnam is serving an 11-year sentence for his role in the scandal. In 2014, a federal appeals court upheld Gupta’s conviction. His petition to the Supreme Court was his last option to have his case reviewed.
Surely this is bullshit. My guess would be big guns punishing small guy as an example. message is don't fish in our part of the pond.. The worry however is that the us judicial system seems to be a medieval war machine rather. I read details of the system squishing that poor Russian programmer who did steal some worthless piece of software from goldman.. it was totally inadequate proportion of force applied.. Seems that those crazy leftists and conspiracy theoretists are right - American business has way too much power. I was dreading the end of the empire and now I am coming to the point that I am not sure it's the bad thing. I am off to Chinese language class!