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I suppose. I mean, I get the difference between quality and quantity, but if we're talking about the gravity of the problem, the knowledge that 50-70% of trades
by abalashov 11y ago
I suppose. I mean, I get the difference between quality and quantity, but if we're talking about the gravity of the problem, the knowledge that 50-70% of trades are HFT/automated tells us something about the nature of our securities, commodities, etc. markets. Doesn't it?
- mrchicity 11y agoBut why does that astound you or strike you as a problem? Look at any mature market and you'll find middlemen buffering supply and demand. Imagine: 50-70% of auto transactions are between dealers who don't even drive their cars and only own them for weeks! 50-70% of bread transactions are between distributors and supermarkets who don't even eat bread and want to sell it in days or even hours!
- abalashov 11y agoThat's a good point. I suppose I assumed that the 50-70% figure referred to front-side securities, futures, or commodity transactions (the equivalent of an end-customer buying a finished product in a retail transaction), rather than amongst various intermediate levels in a complex supply chain.
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