arstechnica.com — Supercomputers pitted against one another in a high-stakes battle of attack and counterattack over a global network where predatory algorithms trawl the information stream, competing every millisecond to gain an informational advantage over rivals. It sounds like Hollywood fiction, but it's just an average trading day on the stock market.
Jul 28, 2009 View in Crawl 4
ziggityzhangJul 28, 2009
How is it gaming the system? The article says that these algorithms are designed to make profits through volume, as in pennies at a time. But it's because the computers trade so many shares a time that they only have to come out with a net profit in the end to be successful. The algorithms are designed to avoid bubbles and other investors figuring out their activities.
Closed AccountJul 28, 2009
This subject was interesting, at least the first 10 times it was posted.
yocouchdiggaJul 29, 2009
well said!
brezzzJul 29, 2009
f**k you! Two of my portfolios died in a financial crisis.
yocouchdiggaJul 29, 2009
It's pretty inconsequential, in the grand scheme of things. The algorithm's behind the HFT's are making their moves based on different data, a bunch of scientists aren't going to let the algorithm run amok on false data. There are alerts to trades and the data the trade's based on. Sure, the machine getting the jump on humans because it picks up the data faster is kind of... messed up but is it messed up when a human gets the info before you and buys? I don't know... it just seems a bit sensationalistic, I don't agree with the use of these autonomous market manipulators but this isn't new by any means. If you want a piece of the action, buy a chunk of a something that's using 'em, like Goldman Sachs for instance... lol
thecoolestguyJul 29, 2009
This is great. It will drive the development of ever faster CPUs and GPUs and that will benefit every one.