Video of High Frequency Trading in Action

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.

Video of High Frequency Trading in Action

Postby FredCouples » Thu May 09, 2013 4:00 pm

FredCouples
 
Posts: 65
Joined: 24 Feb 2010
Location: Miami Lakes, Florida

Re: Video of High Frequency Trading in Action

Postby Optimistic » Thu May 09, 2013 5:22 pm

See here, here, and here.
User avatar
Optimistic
 
Posts: 266
Joined: 28 Sep 2010

Re: Video of High Frequency Trading in Action

Postby SSSS » Thu May 09, 2013 5:42 pm

If there were a way to get that live & in real time, it would make an awesome screen saver.
User avatar
SSSS
 
Posts: 1846
Joined: 18 Jun 2010

Re: Video of High Frequency Trading in Action

Postby nisiprius » Thu May 09, 2013 6:19 pm

Just to make my prejudice clear: I know zip about high frequency trading but I'm agin' it. But the article is so crazily biassed that it could almost make me change my mind. Just because machinery--mechanical or electronic--works too fast for the human mind to comprehend doesn't automatically make it dangerous.

I remember my friends in aero and astro explaining to me that unassisted human reaction time was too slow to control a Boeing 727, and that it was unflyable without analog electronic yaw dampers.

So they show me a picture of something I can't understand. And helpfully tell me that it is "insane" and "terrifying." Because otherwise, how would I know what to think? How do I know whether HFT is inducing oscillations or damping them?

Circa 1970, I used to use a computer called the LINC:

Image

It had 3072 bytes of RAM--actually 2048 12-bit words--I was very pleased to be working on the model with the big, expanded memory, double that of the expanded model. It ran with a memory cycle time of 8 microseconds, and most instructions took two cycles. That is very roughly equivalent to an 0.000625 GHz clock. It had a "single step" mode, a dial, and a four-position switch that would let you run the computer as slowly as one instruction per second, at which you could see the lights flash for each memory cycle and hear ticks from the loudspeaker whenever one bit of the accumulator changed state. You could crank it up to ten, then a hundred, then a thousand, then ten thousand instructions per second, and the flashes would speed up, blur together, and the speaker noise would turn from clicks to Geiger-counter rattles to a raspy screech that would ascend in pitch. It was the only thing I've ever seen that gave me a true visceral feeling for how fast a computer is, and how impossible it is even to imagine what it is doing. At 0.000625 GHz.

Incomprehensibly fast, far beyond human ability to appreciate or control. Not automatically "scary" or "dangerous." A better word might be "awesome."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
User avatar
nisiprius
Advisory Board
 
Posts: 24273
Joined: 26 Jul 2007
Location: "Citizen of the terrestrial sphere"--O. Henry, "A Cosmopolite in a Cafe"

Re: Video of High Frequency Trading in Action

Postby Ranger » Thu May 09, 2013 6:30 pm

Cool video, but it is not reality of HFT.

If you want good discussion of hft, boglehead is not the forum.

Here is one:
http://www.elitetrader.com/vb/showthrea ... did=266552
User avatar
Ranger
 
Posts: 446
Joined: 20 Feb 2007
Location: Wolverine Nation

Re: Video of High Frequency Trading in Action

Postby Rob5TCP » Thu May 09, 2013 7:08 pm

Below is a review of studies on HFT that question their objectivity (being that most were funded by people with connections to the finance industry)

http://prospect.org/article/are-academi ... ing-debate
User avatar
Rob5TCP
 
Posts: 1713
Joined: 5 Jun 2007
Location: New York, NY


Return to Investing - Theory, News & General

Who is online

Users browsing this forum: A_C_E, cfs, IlikeJackB, LaraZP, pjstack, prudent, pteam, sscritic, stevewolfe, wt8008 and 65 guests