Link : http://www.institutionalinvestor.co...nds/Top-News/Hedge-Funds-Boost-FX-Market.aspx
NB. This thread is open to all members to post and share any news and information that are related to the forex, and give opinions.
NB. This thread is open to all members to post and share any news and information that are related to the forex, and give opinions.
Crap Buddist
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The rise of the machines.
"are successfully applying algorithmic strategies to FX trading to generate alpha, using many of the same methods they have applied in the equities market and other asset classes.”
Can anyone expand on this ? Its way over my head. I'll see what comes up in a google but, algo traders ? hmm would these be varied? will it be easier to trade if the machines all boot in, mechanically, do algo's build postions, hours days, minutes ? short term , intra only, or , or, yes to all of it..... and who programs them, do they seek or think the same. Seems a bit grim, like watchin computers play cricket.
The rise of the machines..
I'll be back.
"are successfully applying algorithmic strategies to FX trading to generate alpha, using many of the same methods they have applied in the equities market and other asset classes.”
Can anyone expand on this ? Its way over my head. I'll see what comes up in a google but, algo traders ? hmm would these be varied? will it be easier to trade if the machines all boot in, mechanically, do algo's build postions, hours days, minutes ? short term , intra only, or , or, yes to all of it..... and who programs them, do they seek or think the same. Seems a bit grim, like watchin computers play cricket.
The rise of the machines..
I'll be back.
Crap Buddist
Senior member
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- 289
Algorithmic trading -- where computers make multiple trades in fractions of a second -- has soared to make up 30 percent of equity trading volume according to industry analysts AITE group.
It is also increasing popular in the $3.2 trillion (1.6 trillion pounds) a day foreign exchange market.
EBS, the biggest interbank venue for foreign exchange trading, says algorithmic trading has doubled from around 15 percent of its volumes at the start of 2006 to 30 percent now.
But traders say current volatility is showing the limitations of this form of trading, in equities and forex.
"Algorithmic trading works by taking historical moves to predict what will happen in the future," said Lee Ferridge, senior proprietary trader at Rabobank.
"When market moves bear little resemblance to what has happened in the past all types of model will struggle."
This certainly appears to be the case for Morgan Stanley who reported a $480 million loss in the third quarter from the bank's in-house equities trading desk that employed computer generated models to drive returns. Continued...
http://uk.reuters.com/article/idUKNOA93468320071029
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If anything ok,positive for the directional outright traders if the algo's all pile in on past behaviour, they just cant think when it goes ballastic? Or no one thinks to pull the plug.
It is also increasing popular in the $3.2 trillion (1.6 trillion pounds) a day foreign exchange market.
EBS, the biggest interbank venue for foreign exchange trading, says algorithmic trading has doubled from around 15 percent of its volumes at the start of 2006 to 30 percent now.
But traders say current volatility is showing the limitations of this form of trading, in equities and forex.
"Algorithmic trading works by taking historical moves to predict what will happen in the future," said Lee Ferridge, senior proprietary trader at Rabobank.
"When market moves bear little resemblance to what has happened in the past all types of model will struggle."
This certainly appears to be the case for Morgan Stanley who reported a $480 million loss in the third quarter from the bank's in-house equities trading desk that employed computer generated models to drive returns. Continued...
http://uk.reuters.com/article/idUKNOA93468320071029
-----------------------------------------------------------------------------------------------------
If anything ok,positive for the directional outright traders if the algo's all pile in on past behaviour, they just cant think when it goes ballastic? Or no one thinks to pull the plug.
Crap Buddist
Senior member
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- 289
Well yeah, I mean if Morgan stanley is just 1 firm who had a dodgy quarter, then who made he $480 million off of them?
If collectively these pro's make Billions, who's paying them, cant be all retail small pennies, so who' is losing billions ? Any one got any stats on the industry money pie division ?
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Billionaire Joseph Lewis -- A success story
Reuters news on Dec 26, 2007 :Billionaire Lewis ups stake in Bear Stearns: filing | Reuters
Lewis, who made his fortune trading currencies...
#369 Joseph Lewis - Forbes.com
Age: 70
Fortune: self made
Net Worth: $2.5 bil
Education: High School, Drop Out
The world's #369 billionaire.
Born in London's East End, Lewis made initial wealth expanding family's catering business. Gradually moved into currency trading late 1970s; still an active trader today.
Old Reuters news on Sept 10, 2007 :Joseph Lewis, reclusive rags-to-riches billionaire | Reuters
The rags-to-riches tale of British financier Joseph Lewis reads like a best-selling novel, but the billionaire keeps a low-profile.
Lewis, who made headlines by grabbing one of the biggest single stakes in the No. 5 U.S. brokerage Bear Stearns Cos Inc (BSC.N: Quote, Profile, Research), generally prefers to leave the limelight to his resort properties and a flock of celebrity friends.
Lewis made most of his $2.5 billion fortune in currency trading.
Lewis, who ranks in a Top 20 list of the richest Britons and as the 369th wealthiest person worldwide, according to Forbes 2007 list, left school at 15 to work in his father's catering business.
Lewis was born in 1937 in a pub his father owned in the rough-and-tumble east end of London.
In the late 1970s, Lewis sold the family business, and turned his hand to currency trading. He also moved to the Bahamas, reportedly for its looser tax regime.
Today he divides his time between his Bahamas home, and a luxury estate in the Orlando, Florida area, as well as owning property in Argentina, where there was a reported plot on his life in 1999.
Lewis' U.S. investment firm, the Tavistock Group, is based in Florida, overseeing a portfolio of investments in 170 companies in 15 countries
.....
Who wants to be the next Joseph Lewis? :clap:
Reuters news on Dec 26, 2007 :Billionaire Lewis ups stake in Bear Stearns: filing | Reuters
Lewis, who made his fortune trading currencies...
#369 Joseph Lewis - Forbes.com
Age: 70
Fortune: self made
Net Worth: $2.5 bil
Education: High School, Drop Out
The world's #369 billionaire.
Born in London's East End, Lewis made initial wealth expanding family's catering business. Gradually moved into currency trading late 1970s; still an active trader today.
Old Reuters news on Sept 10, 2007 :Joseph Lewis, reclusive rags-to-riches billionaire | Reuters
The rags-to-riches tale of British financier Joseph Lewis reads like a best-selling novel, but the billionaire keeps a low-profile.
Lewis, who made headlines by grabbing one of the biggest single stakes in the No. 5 U.S. brokerage Bear Stearns Cos Inc (BSC.N: Quote, Profile, Research), generally prefers to leave the limelight to his resort properties and a flock of celebrity friends.
Lewis made most of his $2.5 billion fortune in currency trading.
Lewis, who ranks in a Top 20 list of the richest Britons and as the 369th wealthiest person worldwide, according to Forbes 2007 list, left school at 15 to work in his father's catering business.
Lewis was born in 1937 in a pub his father owned in the rough-and-tumble east end of London.
In the late 1970s, Lewis sold the family business, and turned his hand to currency trading. He also moved to the Bahamas, reportedly for its looser tax regime.
Today he divides his time between his Bahamas home, and a luxury estate in the Orlando, Florida area, as well as owning property in Argentina, where there was a reported plot on his life in 1999.
Lewis' U.S. investment firm, the Tavistock Group, is based in Florida, overseeing a portfolio of investments in 170 companies in 15 countries
.....
Who wants to be the next Joseph Lewis? :clap:
An uneven regulatory playing field
CTFC and NFA are being inconsistent with the rules for the futures and forex traders.
Regulation: An uneven regulatory playing field /Euromoney magazine
Some points:
--- Treasury Amendment stated that the CFTC had the mandate to protect retail customers trading in off-exchange FX futures.
--- US Bankruptcy Code provides special protections for customers trading on an exchange. These protections do not apply to off-exchange forex transactions.
The NFA's stance is that the code should only be amended if the FX industry is subject to the same level of regulation as exchange-traded markets.
--- Forex dealer members make up less than 1% of the NFA's total membership but they account for 20% of the customer complaints...over 50% of the NFA's enforcement docket and over 50% of the emergency enforcement actions NFA has taken during the past year.
CTFC and NFA are being inconsistent with the rules for the futures and forex traders.
Regulation: An uneven regulatory playing field /Euromoney magazine
Some points:
--- Treasury Amendment stated that the CFTC had the mandate to protect retail customers trading in off-exchange FX futures.
--- US Bankruptcy Code provides special protections for customers trading on an exchange. These protections do not apply to off-exchange forex transactions.
The NFA's stance is that the code should only be amended if the FX industry is subject to the same level of regulation as exchange-traded markets.
--- Forex dealer members make up less than 1% of the NFA's total membership but they account for 20% of the customer complaints...over 50% of the NFA's enforcement docket and over 50% of the emergency enforcement actions NFA has taken during the past year.
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