High Frenquency trading
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Skynet is *fuc…* your economy : oh my brain ! | Reflets
(le HFT — High Frequency Trading — est très certainement l’une des causes importantes des casse-gueules à répétitions des « marchés », mais qu’est-ce qui fait tourner ce HFT ? Petit essai de vulgarisation du concept sous-jacent de la boucle de rétroaction Skynet (joli surnom emprunté au film « Terminator » où l’intelligence artificielle mondiale créée par une entreprise éponyme (Skynet) déclenche la perte de l’humanité en retournant les robots contre les êtres humains…) de la finance… « L’I.A de la finance internationale, Skynet, vient de couler l’économie de ton pays et t’emm…toi et tes 60 millions de compatriotes…bip… » C’est à peu près le message que l’on pourrait recevoir des ordinateurs impliqués dans Le High Frequency Trading, largement en cause dans la crise financière actuelle, comme un article récent sur Reflets l’a très bien expliqué. Mais comment ça marche ce truc ?Interview - Farzine Fazel : « Les principaux acteurs du Trading Haute Fréquence sont des boutiques spécialisées ou des Hedge Funds »
Nous faisons le point sur le Trading Haute Fréquence avec Farzine Fazel et Mohamed Radjabou, respectivement Senior Partner et consultant chez Capco qui suggèrent d’encadrer cette activité qui recèle un potentiel de déstabilisation des marchés dans leur ensemble... Next-Finance : Plusieurs grandes banques affirment ne pas prendre part à ce type d’activités. Quels sont les principaux acteurs du Trading Haute Fréquence ? Farzine Fazel et Mohamed Radjabou : Effectivement on ne trouve pas forcément d’acteurs connus du grand public dans le Trading Haute Fréquence.
Exclusive: Regulators seek trading secrets | Reuters
WASHINGTON/NEW YORK (Reuters) - U.S. securities regulators have taken the unprecedented step of asking high-frequency trading firms to hand over the details of their trading strategies, and in some cases, their secret computer codes. The requests for proprietary code and algorithm parameters by the Financial Industry Regulatory Authority (FINRA), a Wall Street brokerage regulator, are part of investigations into suspicious market activity, said Tom Gira, executive vice president of FINRA's market regulation unit. "It's not a fishing expedition or educational exercise. It's because there's something that's troubling us in the marketplace," he said in an interview. The Securities and Exchange Commission, meanwhile, has also begun making requests for proprietary algorithmic trading data as part of its authority to examine financial firms for compliance with U.S. regulations, according to agency officials and outside lawyers.
Everyone knows that high-frequency traders are the evil geniuses of the foreign-exchange market, right? They damage liquidity, swoop aggressively on tiny price errors, curdle milk with their oh-so-fancy computers and generally make the market harder for everyone to navigate. A new study by the BIS, based on research from officials at some 14 central banks, says that high-frequency traders (or HFTs in market speak) smooth out currency movements, help spread liquidity around this fragmented market and help to make trading cheaper for everyone. HFTs do raise big questions, the BIS said. They barely existed 10 years ago, and now, their impact on the market as a whole is still not fully understood.
High-Frequency Trading Is Evil, Right? Not So, Says the BIS - The Source - WSJ
Goodbye High Frequency Trading - Regulators Seek Secret HFT Codes | ZeroHedge
The crusade against High Frequency Trading which Zero Hedge started well over two years ago , is now coming to an end. Reuters reports that U.S. securities regulators have " taken the unprecedented step of asking high-frequency trading firms to hand over the details of their trading strategies, and in some cases, their secret computer codes. " As everyone knows, the only thing of value within the sub-penny scalping HFT universe are the odd nuances in computer code. Which is why its supreme and undisputed secrecy is sacrosanct.
How High Frequency Trading Affects The Market | xTiburon.com
Recent history has delivered some significant swings in the stock market, leaving most investors scratching their heads in awe. It is not uncommon to see intraday ranges of 500 points. Since August 2, 2011 – when the Dow Jones Industrial Average closed down 263 points – there have been 21 trading days where the average has moved at least 1% from open to close. And that doesn’t account for the daily high-low range. The shaky economy has a lot to do with the market jitters experienced almost daily. The European debt crisis continues to infect investor behavior.There is a general view that one way or another the end result of all the high frequency and algorithmic trading will be a blowup. But I don’t think the risk is as big as many are making it out to be. First, let me point out the difference between high frequency trading and algorithmic trading. Both execute using computers, and since computers work really fast, both can be accused of whatever sins are embodied in millisecond trading. High frequency trading is a type of proprietary trading. The trader (or his computer) sees a profit opportunity and trades accordingly.
Risk from High Frequency and Algorithmic Trading Not as Big as Many Think - Seeking Alpha
"It's Not A Market, It's An HFT 'Crop Circle' Crime Scene" - Further Evidence Of Quote Stuffing Manipulation By HFT | ZeroHedge
Recently we posted a required reading analysis by Nanex in which the market trading analytics firm presented irrefutable evidence of quote stuffing by HFT algorithms in tens of stocks, in which thousands of cancelled quotes would reappear each second with a definitive periodicity and regularity, around the time of the May 6 flash crash. Aside from the fact that it is illegal to indicate a quote without a trade intent, this form of quote stuffing is in fact manipulative when conducted by HFT repeaters in specific "shapes" as it actually moves the NBBO actively higher or lower, in cases pushing the bid/offer range up to 10% higher without even one trade ever having occurred , simply by masking a big block order which other algos interpret as bid interest and pull all offers progressively or step function higher (or vice versa, although we have rarely if ever seen the walking down of a stock over the past 18 months).BBC News - Quant trading: How mathematicians rule the markets
Mathematicians and their trading programs are increasingly taking the place of professional investors in financial centres across the world Trading floors were once the preserve of adrenalin-fuelled dealers aggressively executing the orders of brokers who relied on research, experience and gut instinct to decide where best to invest. Long ago computers made dealers redundant, yet brokers and their ilk have remained the masters of the investment universe, free to buy and sell wherever they see fit . But the last bastion of the old order is now under threat.
