Iniciado por MateAmargo

¿Si se tiene la guita "suficiente", para que quieren las supercomputadoras?
En los dias en que Soros hizo su celebre e infame corrida contra la libra, el procesador mas rápido que se conseguia en el mundo, eran unos miserables 150 Mhz... Claro,tenía la guita "suficiente".

Iniciado por Fetuccini

Lo de Soros no fue infame. El mantenimiento artificial de la libra por el Banco de Inglaterra fue el error infame.

Respecto a las computadoras, lo que van a aniquilar será el Trading manual, al igual que en los tiempos de corros y gritos ochenteros el que tenía una conexión 56kb y tiempo real era el amo del parqué.

Al pequeño inversor le da igual: pone su orden de compra que entra cuando se crucen ahí. Yo nunca he tenido problemas para comprar al precio que he puesto, y ni siquiera tengo Tiempo Real. De hecho algunas órdenes limitadas las he tenido hasta 5 horas en espera, y al final se ejecutaron.

Yo ya decidí hace tiempo que la Bolsa no es el lugar en que el ciudadano de a pie debe meter sus ahorros (y menos aún el lugar donde especular, uy perdón, quería decir "jugar"...)

Iniciado por Adicto

¿Qué recomiendas? ¿oro? ¿platino? ¿plata? ¿latunes?

High-Frequency Traders Say Speed Works for Everyone

July 28 (Bloomberg) -- Frank Troise, the head of electronic equity trading products at Barclays Plc, says using computers to execute orders in milliseconds is no different than brokers jockeying for position years ago on the floor of the New York Stock Exchange.

“This has been going on for quite awhile, and it’s now at a fever pitch,” says Troise, 43, who is based in New York. “There’s always been an advantage to executing with speed.”

Policymakers are asking whether that advantage has become too great for so-called high-frequency traders, whose programs buy and sell shares up to 1,000 times faster than the blink of an eye. Defenders say the competition for profits that gave rise to today’s rapid-fire execution has roots that span decades and has helped reduce costs for investors.

About 46 percent of daily volume is handled through high- frequency strategies, according to estimates by NYSE Euronext, the world’s largest owner of stock exchanges. The transactions are made by about 400 of the 20,000 firms trading stocks in the U.S., according to Tabb Group LLC, a New York-based financial services consultant. Each makes bets in hundredths of a second to exploit tiny price swings in equities and discrepancies in futures, options and exchange-traded funds.

The firms compete for a slice of $21.8 billion in annual profits from equities and derivatives market making and arbitrage, according to Tabb. Among the largest are hedge funds Citadel Investment Group LLC, D.E. Shaw & Co. and Renaissance Technologies Corp., as well as the automated brokerages Getco LLC, Hudson River Trading LLC and Wolverine Trading LLC.

‘Lot of Brainpower’

Rapid-fire strategies helped equity volume more than double in the U.S. since 2006 to a record 10.8 billion shares a day last year, Nasdaq OMX Group Inc. data show.

High-frequency programs look for patterns in securities markets. A typical strategy is based on the likelihood that a stock that rose over the past 20 hours will pare its gain, said Irene Aldridge, managing partner at Toronto-based Able Alpha Trading Ltd., a high-speed proprietary trading firm. Others sift through thousands of quotes to calculate the probability of a shift in the market.

“There’s a lot of brainpower involved in this,” said Aldridge, whose book “High-Frequency Trading: A Practical Guide to Algorithmic Strategies and Trading Systems” is scheduled for publication in January 2010. “It’s profitable if you can capture a few basis points and do it a few times a day, and markets have evolved to support this.”

Penny Increments

U.S. equity exchanges have catered to such clients since at least 1997, when the NYSE ended its century-old practice of quoting stocks in eighths of a dollar. It shifted to penny increments in 2000. That eroded earnings for NYSE and Nasdaq market makers, who profit from the difference between bids and offers. For investors, it helped reduce trading costs.

The exchanges sought to compensate for the lost business by paying rebates to high-frequency brokerages that buy shares at the best public prices. Exchanges have also overhauled their trading systems to cut transactions times and rent space in data centers so it takes less time to transmit information to buyers and sellers. Bats Global Markets processes orders in less than 400 microseconds, or 0.0004 second, which is about 1,000 times faster than humans blink their eyes.

Partha Mohanram, a finance professor at Columbia University in New York, said that instead of imposing limits on the use of technology, exchanges should ensure everyone gets trading data at the same time.

‘Same Priority’

“The key is a level playing field, but you should not lower the playing field to make it level,” he said. “All you have to do is make sure everybody has the same level of access. I don’t think there’s anything wrong with high-speed trading per se if they have the same priority as any other investor.”

As the strategies increased in speed, it became impossible for investors without advanced computer systems to get fair prices, according to some market participants. Firms handling large trades complained that brokers using complex algorithms fire off hundreds of orders and immediately cancel them in an effort to trick them into revealing plans to buy or sell.

“If you’re trying to buy a big block of stock, the algorithms notice,” said Bart Barnett, head of equity trading at Morgan Keegan & Co. in Memphis, Tennessee. “It increases volatility and has an adverse effect on the prices customers get on stocks.”

Holding Orders

New York’s Charles Schumer, the third-ranking Senate Democrat, asked the Securities and Exchange Commission on July 24 to ban a practice in which some exchanges hold orders for a split-second before publishing them on competing platforms. Schumer said so-called flash orders are used by “sophisticated high-frequency traders” to get an edge.

At Bats, the third-largest U.S. stock exchange, about half of its customers use flash orders, Chief Executive Officer Joe Ratterman said in an interview yesterday. The system is open to everyone and has resulted in brokers submitting orders that are more competitive, he said.

Ratterman said the danger of flash trades is that brokers may grow reluctant to post publicly accessible quotes, opting instead to wait for flashed orders. That doesn’t mean the deck is stacked against small investors, he said.

“The idea of haves and have-nots is just crazy to me,” Ratterman said. “Every firm in the U.S. has the ability to invest in the same way that every successful trading firm has done. Trading by definition is a competitive business.”

Ben Townson of New York-based BlackBox Group, which uses high-frequency strategies and specializes in algorithmic trading, says “natural abilities and skills” determine who makes money, not computers.

“You can throw a lot of money at technology, but if you don’t take the time to study your trades, it doesn’t matter,” Townson said. “We’ve built a racecar that is optimized for driving fast. Is that an advantage? Yes. Is it an unfair advantage? No.”

SEC to Ban Flash Trades of U.S. Stocks, Schumer Says (Update3)

Aug. 4 (Bloomberg) -- The U.S. Securities and Exchange Commission will seek to ban flash trades that give some brokerages an advance look at orders, Senator Charles Schumer said, citing a conversation with SEC Chairman Mary Schapiro.

Schapiro assured Schumer in a phone call yesterday that the agency plans to ban the practice, according to a statement from his office. In a separate release, Schapiro said she has asked her staff to draft rules that “quickly eliminate the inequity” that flash orders cause.

“It’s preferencing one group over another, and that’s not the way markets should work,” said Michael Panzner, author of “The New Laws of the Stock Market Jungle” who once traded for George Soros’s hedge fund. “It certainly on its face seems unfair and up until now was against the spirit, now perhaps against the actual rules, of fair play.”

A ban would reverse decisions since at least 2004, when the SEC first approved the systems at the Boston Options Exchange. Nasdaq OMX Group Inc., Bats Global Markets, Direct Edge Holdings LLC and the CBOE Stock Exchange give information to their clients about orders for a fraction of a second before the trades are routed to rival platforms. The technique is meant to give investors another opportunity to complete a transaction.

Schumer told the SEC in a July 24 letter to halt flash orders, saying he would propose legislation barring them if the agency didn’t act. NYSE Euronext, the world’s largest owner of stock exchanges, as well as brokerages Morgan Stanley and Getco LLC have said the practice may result in investors getting worse prices.

30 to 90 Days

Schapiro said any proposal to ban the transactions would require approval from SEC commissioners and public comment. SEC rulemaking is usually a two-step process. The agency’s staff proposes a regulation, and commissioners vote to solicit public feedback for between 30 and 90 days. Once the comment period ends, commissioners vote on whether to make the rule binding. The SEC can speed up the process by issuing temporary rules.

“These issues are very complex and not widely understood,” said Lawrence Harris, a former SEC chief economist who is now a business professor at the University of Southern California in Los Angeles. “The consequence is that, occasionally, even experts will make mistakes. Fortunately, the SEC has mechanisms to revisit decisions that after the fact appear to be made with too much haste.”

Private Markets

Nasdaq and Bats said last week they support an industrywide ban on flash orders. In a July 27 letter, Nasdaq Chief Executive Officer Robert Greifeld urged the SEC to examine alternative systems that don’t publicly display their orders to investors. The SEC should examine whether the information in the flash trade is readily accessible and clearly identifiable to brokers who have to execute trades at the best price, Bats CEO Joe Ratterman said in a July 7 newsletter to clients.

Flash orders represented 2.4 percent of the shares traded in the U.S. in June, according to the New York brokerage Rosenblatt Securities Inc. At Direct Edge, which handles most of the flash volume, revenue from its Enhanced Liquidity Provider program has helped it cut other trading fees and more than double its market share since November.

A ban would help Direct Edge’s rivals, particularly NYSE Euronext, Raymond James Financial Inc. analyst Patrick O’Shaughnessy wrote in a July 27 report to clients.

NYSE Euronext, the only one of the top four U.S. exchanges that doesn’t use flash orders, added 2.4 percent to $27.40 at 4 p.m. in New York. Nasdaq shares fell 0.3 percent to $21.39.

Traders Yelling

Flash systems trace their roots as far back as 1978 to efforts by exchanges to electronically replicate how a trader might yell an order to floor brokers before entering it into the system that displays all bids and offers. Markets have evolved since the days of floor brokers’ dominance, with computer algorithms now buying and selling shares 1,000 times faster than the blink of an eye.

“This is a relatively old concept. However, the electronification of it makes it more dangerous than it used to be,” Sean O’Malley, a former lawyer at the SEC’s division of trading and markets who is now a partner at Goodwin Procter LLP in New York. “Computer-based trading is going to be able to do things in a split second that no human could have done. That’s something that the SEC probably hadn’t thought about as much until this year.”

70% of Trading

The proposal may be a sign regulators are moving to stricter oversight of so-called high-frequency trading, in which brokerages using advanced computers execute thousands of transactions in a second. Those strategies may account for 70 percent of trading volume, according to O’Shaughnessy.

While flash orders make up a small fraction of high-speed transactions, they have drawn the most criticism from investors and traders. Goldman Sachs Group Inc. released a statement today in light of the “complex landscape” surrounding high-frequency trading, saying the strategy accounted for less than 1 percent of its revenue and that it doesn’t use flash programs in executing client agency orders.

“Unfortunately, flash trading gives a bad name to high- frequency trading,” said Irene Aldridge, author of “High- Frequency Trading: A Practical Guide to Algorithmic Strategies and Trading Systems.” “Most high-frequency trading has nothing to do with flash orders, so it’s going to continue as business as usual.”