High frequency trading is losing its appeal

FXX

Experienced member
1,156 197
Odd, I can read it but only through LinkedIn. Here is a snippet

Trading firms are struggling to wring profits from the incremental millisecond. Subdued volumes and reduced volatility have shrunken the size of the pie. Exchanges have ratcheted up market data and technology costs for customers. In 2017, aggregate revenues for HFT companies from trading US stocks was set to fall below $1bn for the first time since at least the financial crisis, down from $7.2bn in 2009, according to estimates from Tabb Group, a consultancy.

"The combination of low volatility and increasing costs has been tough for firms,” says Rob Creamer, chief executive of Geneva Trading, a Chicago-based firm. “People see it as a war of attrition.”
 

Nowler

Established member
980 81
Odd, I can read it but only through LinkedIn. Here is a snippet

Trading firms are struggling to wring profits from the incremental millisecond. Subdued volumes and reduced volatility have shrunken the size of the pie. Exchanges have ratcheted up market data and technology costs for customers. In 2017, aggregate revenues for HFT companies from trading US stocks was set to fall below $1bn for the first time since at least the financial crisis, down from $7.2bn in 2009, according to estimates from Tabb Group, a consultancy.

"The combination of low volatility and increasing costs has been tough for firms,” says Rob Creamer, chief executive of Geneva Trading, a Chicago-based firm. “People see it as a war of attrition.”
It shows up for a quick second but then quickly hides it and shows a sign-up/subscribe feature in its place.

Thanks for the snippet.
I wouldn't know enough to hold a conversation about it but I know what HFT is and I know that it snaps up most if not all of "the low hanging fruit"... which is bad for me because it means I have even less of a chance of making money. So the enemy of my enemy is my friend :)

Interesting to see how this plays out
 

FXX

Experienced member
1,156 197
It shows up for a quick second but then quickly hides it and shows a sign-up/subscribe feature in its place.

Thanks for the snippet.
I wouldn't know enough to hold a conversation about it but I know what HFT is and I know that it snaps up most if not all of "the low hanging fruit"... which is bad for me because it means I have even less of a chance of making money. So the enemy of my enemy is my friend :)

Interesting to see how this plays out
You have a fair chance of success. All you need to do is nail down a trading process and avoid the traps that get most retail traders (trading off only charts). Structure your education so that you get there incrementally in your understanding and application. Define a schedule for research so that you know exactly what you are looking for, how you are going to execute it, and a review process to help you iron out trends in errors. All you want to do is achieve 1 to 5 percent a month which can be achieved in as few as a handful of trades so work on quality over quantity (there are plenty of opportunities available on an ongoing basis to get you there).
 

Nowler

Established member
980 81
You have a fair chance of success. All you need to do is nail down a trading process and avoid the traps that get most retail traders (trading off only charts). Structure your education so that you get there incrementally in your understanding and application. Define a schedule for research so that you know exactly what you are looking for, how you are going to execute it, and a review process to help you iron out trends in errors. All you want to do is achieve 1 to 5 percent a month which can be achieved in as few as a handful of trades so work on quality over quantity (there are plenty of opportunities available on an ongoing basis to get you there).
5% a month! :sick: vomits :sick:
Do you remember that month where I got 20% one week, 11% the following and then 15% the one after? Long gone are those days eh! :LOL:

At the time I thought that it was achievable to pull this in regularly enough :whistling

Ok so if my current income is say €800 per month, then in order to pull that in from trading I'd need an account size of €16,000, minimum (800 being 5%)... I better speed up my move to the UK and get a job, and fast! :LOL:

Thanks for the encouraging words though mate. I definitely need to be smarter with a lot of things! A schedule would crown me!

Note: Not sure how I managed to skew this thread off topic. Sorry
 

Quantt

Established member
944 58
Thanks FXX, interesting indeed, I wonder how Virtu are doing, I remember when they had 1 losing day in the whole year, also Citadel... We'll see when they post some sort of returns for 2017 (Virtu is a publicly traded company)...

Personally as a small time trader, I do like the HTF shops, because they bring liquidity and since I am trading high volume stocks, I am pretty confident when my stop hits, usually my slippage would be 1 cent... So I am OK to be front run by them to pay for it... What I don't like in the whole picture are the dark pools and this is a problem coming more from the banks and the big financial institutions...
 

FXX

Experienced member
1,156 197
5% a month! :sick: vomits :sick:
Do you remember that month where I got 20% one week, 11% the following and then 15% the one after? Long gone are those days eh! :LOL:

At the time I thought that it was achievable to pull this in regularly enough :whistling

Ok so if my current income is say €800 per month, then in order to pull that in from trading I'd need an account size of €16,000, minimum (800 being 5%)... I better speed up my move to the UK and get a job, and fast! :LOL:

Thanks for the encouraging words though mate. I definitely need to be smarter with a lot of things! A schedule would crown me!

Note: Not sure how I managed to skew this thread off topic. Sorry
where in Ireland are you?
 

FXX

Experienced member
1,156 197
Thanks FXX, interesting indeed, I wonder how Virtu are doing, I remember when they had 1 losing day in the whole year, also Citadel... We'll see when they post some sort of returns for 2017 (Virtu is a publicly traded company)...

Personally as a small time trader, I do like the HTF shops, because they bring liquidity and since I am trading high volume stocks, I am pretty confident when my stop hits, usually my slippage would be 1 cent... So I am OK to be front run by them to pay for it... What I don't like in the whole picture are the dark pools and this is a problem coming more from the banks and the big financial institutions...
when you get that data please do post it here. Would be interesting to compare it to previous years
 

mike.

Senior member
2,099 706
Thanks FXX, interesting indeed, I wonder how Virtu are doing, I remember when they had 1 losing day in the whole year, also Citadel... We'll see when they post some sort of returns for 2017 (Virtu is a publicly traded company)...

Personally as a small time trader, I do like the HTF shops, because they bring liquidity and since I am trading high volume stocks, I am pretty confident when my stop hits, usually my slippage would be 1 cent... So I am OK to be front run by them to pay for it... What I don't like in the whole picture are the dark pools and this is a problem coming more from the banks and the big financial institutions...
The dark pools are inter bank to route orders for their own customers, I understand many of the HFT companies pay a subscription to access them, That shouldn’t really affect you as a retail trader though quantt surely ?
 

Quantt

Established member
944 58
The dark pools are inter bank to route orders for their own customers, I understand many of the HFT companies pay a subscription to access them, That shouldn’t really affect you as a retail trader though quantt surely ?
Yep, frankly I don't know exactly how it is going to affect my trading if any, but I am all for transparency and I think eliminating the dark pools would boost volume and improve the spread in general, so I object on principle :)
 

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