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It's a market for intangibles; over the short term it's zero-sum. The only way to profit is to induce mistakes; to get someone on the other side of a trade tha
by khafra 17y ago
It's a market for intangibles; over the short term it's zero-sum. The only way to profit is to induce mistakes; to get someone on the other side of a trade that's profitable to you and damaging to them.
If algorithmic trading causes vulnerability to mistakes, they need to revise their algorithms or factor in the risk of this type of loss; that's the way free markets work. The externalities of a sudden crash suck, but other than as a one-time emergency measure, rolling back all the trades isn't a good solution. Wall Street firms should've learned something since 1987.
- rbanffy 17y agoThis is the normal operation. The "undo" key is not supposed to be used unless something abnormal happens.
- ams6110 17y agoMy guess is that the algorithms are already being adjusted. My fear is that a bunch of politicians who are as clueless as most everyone else are going to try use this as yet another opportunity to grab the spotlight. Expect congressional hearings.