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  • High-Frequency Trading Prospers at Expense of Everyone

    From bloomberg.com

    Read Full Story at bloomberg.com

    Finally, a bit of evidence, rather than anecdote, about the costs of high-frequency trading. In a new study, Andrei Kirilenko, the chief economist at the U.S. Commodity Futures Trading Commission, along with researchers at Princeton University and the University of Washington, examined high-frequency trading in a futures contract called the e-mini S&P 500, between August 2010 and August 2012. The study looked at only the expiring contracts (which trade electronically on the Chicago Mercantile Exchange) that are used to bet on the direction of the Standard & Poor’s 500 Index. The researchers ... (full story)

    • krisware

      573 posts
    • Does it really matter ... it won't change the fact that 95% lose and 5% win ... this rule goes for stocks, forex, casino, lottery etc. ... just get used to it

    • Guest

      IP XX.XXX.112.246
    • Hft manipulation is the only reason why euro is strong and markets are up. It needs to be removed from the system because it does not add liquidity to the system and it is a form of legalized insider trading. Germany, Canada , and Australia have already implemented policies to restrict hft but the US have not. They are only observing the dangers. There are too many corrupt politicians and leaders that want to keep market up.

    • Guest

      IP XX.XXX.17.122
    • I hope we have the another flash crash like may 2010, except worse. That will be the only way to stop algorithm trading. Sad to realize that it must take something of this magnitude to stop the bullshit but thats the way it is. There's no reason people should be allowed to trade for a few seconds over a thousand times a day!!! period!!!

    • Dan Murray

      5 posts
    • One VERY IMPORTANT point! The study examined data for only one month (August 2010). So while this study is interesting, they didn't use nearly enough data to conclude anything.

    • Ann

      83 posts
    • They looked at data from August 2010 to August 2012---2 years worth of data. Not one month....

    • Guest

      IP XX.XXX.100.250
    • If you remove hft from the system DOW will be at 8500 and s&p will be at 1250 or less. Bernanke needs to protect his reputation so that he is employed after leaves office. Feds and SEC have never been right in predicting future risk. Did they warn you about housing bubble, tech bubble, flash crash, etc? The answer is no. The consequence of hft manipulation combined with aggressive monetary policies is still unknown. However bernanke talks a good game and pretends to know the future of his action. Fucking idiot. Inflation ahead and market crash.

    • Phil_GMT

      100 posts
    • Apparently I've been reading that HFT in FX really took off in 2007 so I have been analysing tick data from 2007 up until now and I'll say I Prefer movements in the EURUSD after 2007 than before. Intraday market was slow as hell prior 2007 for my type of trading. Also my indicators are not optimised for those conditions.

      HFT makes it more predictable not the other way around.

    • piptastic

      197 posts
    • lol only people that have problem with HFTs are people that are losing money... Like that guy that said "Hft manipulation is the only reason why euro is strong and markets are up"....wtf does it matter, he's probly in the wrong side of the trade. Losers are always gonna blame something else for their stupidity. Trend is Trend idc if Satan was manipulating it, if satan make trends i like him...

    • love.l0ve

      110 posts
    • Loser always find something to blame
      Shame on them

    • michaelpelly

      314 posts
    • Hah, I like the last 2 comments :-). I agree - wrong judgement of the trend and poor risk management is not due to HFT mechanisms.

    • Mingary

      708 posts
    • Just another scapegoat to blame when you lose....

    • Guest

      IP XX.XXX.112.246
    • So many drones that don't care about fixing the system. Blinded by charts and technical analysis. They have a lot to say about support and resistance but add no value to the bigger picture. Continue to live in your cave you old fat man

    • michaelpelly

      314 posts
    • Well I suppose you expect only nice sinusoidal movements for each currency pair with extreme points in same position every time with a fixed angle of accent/descent?!

      That is not going to happen my friend.

      If the markets worked like this - everyone would be rich right now...

      The HFT systems add extra volatility along with the crowd psychology and bank insider trades ;-) - that is the game - either play it, or get off the train - choice is always yours...:-)

    • piptastic

      197 posts
    • Quoting Guest
      So many drones that don't care about fixing the system. Blinded by charts and technical analysis. They have a lot to say about support and resistance but add no value to the bigger picture. Continue to live in your cave you old fat man
      Fixing the system?? you fool. Besides we are traders over here, real traders dont care about fixing shit (sorry to disappoint you) as long as the market is moving...we're happy :-)

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