4 ms·
Think about it this way. They are publicly advertising to their investors that they have a weapon to defeat HFT. Because of this, they will get better returns
by Johnie 10y ago
Think about it this way. They are publicly advertising to their investors that they have a weapon to defeat HFT. Because of this, they will get better returns.
When an investor decides to put their money in a fund, are they going to choose the one that has a patented defense against HFT or will that investor put their money into a fund that has a known vulnerability?
>It's fairly general: send orders ahead to co-located servers to be executed at specific times.
This is harder than it sounds. Coordinating a number of servers in different locations to send a trade at a specific time is not that straightforward when you're dealing with microsecond or nanosecond transactions.
Forget the trade, just trying to synchronize the time on all of the different servers in different locations is a large challenge. NTP has an accuracy of 10ms on the open internet [1]. The state of art in HFT is sub-microseconds [2]. This is at least 2 orders of magnitude faster than the NTP margin of error.
[1] https://en.wikipedia.org/wiki/Network_Time_Protocol https://en.wikipedia.org/wiki/Network_Time_Protocol
[2] http://stackoverflow.com/questions/17256040/how-fast-is-state-of-the-art-hft-trading-systems-today http://stackoverflow.com/questions/17256040/how-fast-is-stat...
- polskibus 10y agoA hedge fund with track record of Reinessance Technologies does not have to advertise to investors in any way. They just choose not to raise more capital because in some ways they are unable to push it to such returns (when you are too big, you can't move as quickly without moving the market against you).
- welterde 10y agoYou have to keep in mind that the mentioned sub-microseconds are the _reaction time_. HFT can't beat the speed of light either. Therefore if your orders are synchronized to better than the speed of light distance to the next exchange, HFT traders won't be able to profit off them (-> you have milliseconds). With GPS receivers or very good network connectivity to your ntp server (ie. not home dsl) you can easily get down to below 1ms.
- Bromskloss 10y ago> They are publicly advertising to their investors that they have a weapon to defeat HFT. I thought RenTech didn't have investors anymore.
- usefulcat 10y agoSo use PTP with a local source instead of NTP over the internet. "On a local area network, [PTP] achieves clock accuracy in the sub-microsecond range" https://en.wikipedia.org/wiki/Precision_Time_Protocol https://en.wikipedia.org/wiki/Precision_Time_Protocol I disagree that the problem the patent purports to solve is particularly difficult, given the technology that is already readily available (PTP, an OS with a high resolution clock, machines located in exchange data centers).