Interesting Read - Percieved Impact of High Frequency Trading

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Old Jan 5, 2010, 9:28am   #1
Joined Sep 2004
Interesting Read - Percieved Impact of High Frequency Trading

Was sent this not long ago (although it's not hot off the press). Worth a read for a peek under the lid of the institutional world for anyone interested.

GJ

http://www.thetradenews.com/trading-...he+buy-side%29
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Old Jan 5, 2010, 11:16am   #2
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Re: Interesting Read - Percieved Impact of High Frequency Trading

decent read but still quite a polarised view from someone selling the tech.

example: market is 23-28 on abc security, size up 1000x100. i offer 25's in 250. Suddenly market is 23-25 in 1000x 800. Someone lifts 25's and i get eg 100 lots and it's left offered over. the algo that joined me gets the majority. according to scott (head of sales, algo trading) i should amend my market practice. this means i should hit the bid, costing me money.

Last edited by gooseman; Jan 5, 2010 at 11:37am.
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Old Jan 5, 2010, 11:32am   #3
 
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Re: Interesting Read - Percieved Impact of High Frequency Trading

1) Markets should always operate on a FIFO principal (except where a spread trade is entered) imo
2) Orders should be placed for a minimum of (say) 250 milliseconds to eleiminate a lot of the "gaming"

Put these two rules in place & I'd be a lot less sceptical about the value algo trading brings.
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Old Jan 5, 2010, 11:33am   #4
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Re: Interesting Read - Percieved Impact of High Frequency Trading

GammaJammer started this thread How come the algo that joined you gets the majority? What are the matching rules - you saying it's not first in? Am I being a bit dense? (Have to admit I did skim-read it a touch).
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Old Jan 5, 2010, 11:37am   #5
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Re: Interesting Read - Percieved Impact of High Frequency Trading

exactly-exchange dependent.
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Old Jan 5, 2010, 11:43am   #6
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Re: Interesting Read - Percieved Impact of High Frequency Trading

anyone complaining about high frequency trading its simple stop piking around for 1 tick. I couldnt give a damn how quickly someone can hit the bid or offer before me when im looking for a $10 move.
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Old Jan 5, 2010, 12:07pm   #7
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Re: Interesting Read - Percieved Impact of High Frequency Trading

Quote:
Originally Posted by crude_lover View Post
anyone complaining about high frequency trading its simple stop piking around for 1 tick. I couldnt give a damn how quickly someone can hit the bid or offer before me when im looking for a $10 move.
utter horse plop.
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