4 ms·
Not sure what the article is even trying to say. The typical HFT firm will have it's computers colocated inside the exchange and will be working the order book
by stillworks 8y ago
Not sure what the article is even trying to say.
The typical HFT firm will have it's computers colocated inside the exchange and will be working the order books of instruments listed on that specific exchange.
There are some "complicated" smoke and mirror setups for eg where execution reports of the HFT are "captured" by some "big broker" on the street and HFT's trades are booked by the big broker, but again, the big broker's computer is also in this case colocated in the venue.
What is exactly slowing down HFT ? What is the overlap of instruments between these venues ?
- qeternity 8y agoUnfortunately there are over 50 ATS in the US, and although most people think the “stock market” is in New York, it’s really in Chicago (eminis run the world these days). Trading spooz against single names as HFT do often use microwave antenna transmission.
- baybal2 8y agoThis is, I believe, a setup specifically for inter-exchange arbitrage, front-running
- hueving 8y agoInter-exchange arbitrage is not front-running because they are using public information. https://en.wikipedia.org/wiki/Front_running https://en.wikipedia.org/wiki/Front_running
- paulie_a 8y ago> colocated inside and exchange That is why I think all trades should be arbitrarily delayed by a random number of milliseconds.
- stillworks 8y agoThat would be fundamentally wrong. At least in the case of cash equity, as soon as a buyer matches a seller, the price of the instrument should be updated in real time. Same applies to inserting orders in the order book, there should be zero delay, so that the exchange can halt to auction as soon as it detects out of the norm bids (or asks).