4 ms·
>Now the authorities must decide whether anyone at Vega breached market rules by joining forces to push down prices—or if they simply pulled off one of the grea
by bsanr2 6y ago
>Now the authorities must decide whether anyone at Vega breached market rules by joining forces to push down prices—or if they simply pulled off one of the greatest trades in history.
Couched in these terms, it's really difficult not to think of trading as a sort of game. What are these rules, why is breaking them a bad thing, who set them up, and why is foul play suspected and investigated with aplomb when relative small-timers make out like bandits but not when big establishment institutions drop the ball to the tune of "generalized economic ruin"?
- vmception 6y agoI approach the whole market as a MMORPG, with very real consequences (Massive Multiplayer Online Role Playing Game) It is always surprising for me to discover that there are people that debate about that. Or more so comforting to understand my competition is not that competitive.
- specialist 6y agoWith sysadmins, with discretion to selectively enforce, suspend, rewrite rules and transactions, with nominal accountability.
- qeternity 6y agoTrading absolutely is a game, and the “score” so to speak of this game being “price” is an extremely important piece of information to society. Price contains all known data (according to EMH) and then is freely (or cheaply) observed by all participants. It’s not a bad thing that it’s a game, in fact most games are calculated risk, just like trading. But like other games, you need fair and consistent rules. Source: former hedge fund trader
- quickthrower2 6y agoRules are there so you can trust the system enough. Imagine if there were no rules: your bank might steal your money, a company might lie on its financial reports so a shareholder can dump some stock etc. Then all trust is lost and every deal with every entity needs to be worked out from scratch. You’d do extensive DD to open a bank account or buy a stock. This would cripple the system.
- ada1981 6y agoCould you imagine?
- leetcrew 6y agothe idea (or the lie, depending on your perspective) is that the market price converges to a fair valuation, based on the information available at the time. true or not, it is important that market participants mostly believe this, lest the whole thing unravel at once. I'm not sure exactly what these traders are suspected of doing, the article is rather scant on details.
- im3w1l 6y agoHaving the same actions be allowed or prohibited depending on intents in your heart only you can observe is not very game-like.