Path: csiph.com!usenet.pasdenom.info!weretis.net!feeder1.news.weretis.net!news.swapon.de!eternal-september.org!feeder.eternal-september.org!news.eternal-september.org!.POSTED!not-for-mail From: Atom Cogswell Newsgroups: comp.misc Subject: Re: Laser network between NYSE and Nasdaq will allow more HFT profits Date: Sat, 15 Feb 2014 11:17:57 -0700 Organization: A noiseless patient Spider Lines: 18 Message-ID: References: <5b1c6369-caa9-4b38-b1bf-6678ac6d4cee@googlegroups.com> Mime-Version: 1.0 Content-Type: text/plain; charset=ISO-8859-1 Content-Transfer-Encoding: 7bit Injection-Date: Sat, 15 Feb 2014 18:18:23 +0000 (UTC) Injection-Info: mx05.eternal-september.org; posting-host="db8a84d057a94e2d4062a295b5f0e3f9"; logging-data="32582"; mail-complaints-to="abuse@eternal-september.org"; posting-account="U2FsdGVkX1/lNRtH4tB0j55XNmJdJq5PyUojYaZgZPs=" User-Agent: Mozilla/5.0 (Windows NT 6.1; WOW64; rv:24.0) Gecko/20100101 Thunderbird/24.3.0 In-Reply-To: <5b1c6369-caa9-4b38-b1bf-6678ac6d4cee@googlegroups.com> Cancel-Lock: sha1:Ye6fOkK8n+/FOMmGqTAhndSB9Ak= Xref: csiph.com comp.misc:437 On 2/14/2014 8:43 PM, deepmagicbeginshere@gmail.com wrote: > If I were building that, it would be bonded to the existing microwave system, so any interruption would cause it to fail back to the microwave, which is nanoseconds slower. So... Quadracopters with chaff canisters then? My point of view: HFT provides liquidity. That's a good thing, since each buyer must find a seller, and the other way around. The side effect of liquidity is volatility. That's going to be unavoidable. The 'service' of providing liquidity is worth something to traders in a general sense, since trades can be made quickly, but the value proposition is this: They're basically playing a latency game with fast networks and finely tuned algorithms, and siphoning heaps of wealth away in the process, without providing any measure of productivity. I don't see sustainability in this practice. Following the low pass filter analogy, what happens when these firms decide they aren't happy with the profit, and they turn up the knob?