are traders becoming extinct?

will traders become extinct within the next 10 years because of HFT algos?

roger123doger said:

will traders become extinct within the next 10 years because of HFT algos?

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Doubt it. I don't see the correlation. If the markets are moving, people will be trading. If the game changes or the rules change you have to adapt. Good discipline, proper money management, and the ability to choose what trades to take will always be a large part of the retail traders toolbox.

Peter

roger123doger said:

will traders become extinct within the next 10 years because of HFT algos?

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Yes, but not just due to the single issue you highlight and more gradually...*we* are necessary though, for now...similar to how punters are nec in the equity markets..

roger123doger said:

will traders become extinct within the next 10 years because of HFT algos?

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...

The market's are comparable to a complex eco-system in nature. Trader numbers may take a hit from algos, algos then have a bit less to feed off, traders evolve those that survive the algos prosper and increase, algos evolve and the cycle continues. Extinction of individual species of traders happens all the time and algos no doubt destroyed certain types of traders completely removing their edge, but its happened before in different forms and I don't think HFT is the apocalyptic event which will extinct all species of trader.

Black Swan said:

Yes, but not just due to the single issue you highlight and more gradually...*we* are necessary though, for now...similar to how punters are nec in the equity markets..

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i do wonder if the role of markets and speculators within those markets will become more of an explicit target of political debate and eventual regulation given the perceived impact financial market volatility has on the real economy. Don't get me wrong, I think that there is always a role for the speculator in a market - and in fact they are needed, but governments are getting larger, the gap between rich and poor larger, and the link between speculators involvement in markets and prices that affect peoples everyday lives is becoming more exposed...hence it will become more of a point of debate.

think about the Fed's (potential) QE...will small businesses be able to get their hands on much needed $$$ more easily? will employment increase?....probably not. will HF's and prop books continue to be able to fund themselves cheaply and continue to speculate in higher yielding ccy's...probably.

just a thght

I think there are going to be amazing trading opportunities over the next few years, and I seriously hope that is not the kiss of death (!!).

I've also wondered if computers will eventually take over, but that's at least twenty years away I would think, if it ever happens. If you think about ALL the participants in the market, in any market, how could you ever replace that with algos? Company A buys company B and has a FX trade to do.. what is that to do with algos? Pension funds relocate assets - this is not controlled by algos.

Scalping may become more difficult but there are always going to be opportunities on a longer time frame.

Man is a born survivor,the human mind is quicker than algorithms in adapting to changing markets.

oildaytrader said:

Man is a born survivor,the human mind is quicker than algorithms in adapting to changing markets.

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"ODT", I'm interested to know if you are a real person, or some kind of t2w virus.

"You" claim to have 44 algos running, yet suddenly the "human mind is quicker".

Black Swan said:

Yes, but not just due to the single issue you highlight and more gradually...*we* are necessary though, for now...similar to how punters are nec in the equity markets..

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Take heed to Black Swans comment,..he's bang on the money!

meanreversion said:

"ODT", I'm interested to know if you are a real person, or some kind of t2w virus.

"You" claim to have 44 algos running, yet suddenly the "human mind is quicker".

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I am not in the mood for you darling.

I'm more worried about idiot politicians like Obama making it harder and harder for people to trade, than I am about Hedge Fund algos.

as the saying goes, markets are "weighing machines in the long run, voting machines in the short run"...

Computers / Algo's may well dominate the "voting machine" end of the scale, because they can deal with the flow of information on a granular basis and much, much faster than any human can. But as you extend the timescale, the "voting" portion gives way to the "weighing" portion, and I don't think computers can compete there (yet).

I've traded full time for a living for more than 10 years and part time before that.
You just have to change what you do when markets and their environs change.
Adapt or die.
Richard