4 ms·

Do you have a 401k?

by dahfizz 3y ago

Do you have a 401k?

AnimalMuppet 3y ago
I'm not the one you're asking, but yes, I do. So? Do you think the value of my 401k depends on HFT? I don't.
- Spooky23 3y ago
  Before HFT, stock exchanges couldn’t provide liquidity and wide spreads cost retail investors tens of dollars a year. When you retire, every time you go to Starbucks, you can rest assured that the savings on your 401k distribution will allow you get an extra shot, once a month. The innovators making this possible of course skim billions, but you get that free shot.
  - candiddevmike 3y ago
    I don't think eliminating sub second stock trading would impact this scenario.
  - cosmojg 3y ago
    > wide spreads cost retail investors tens of dollars a year. A veritable tragedy! I'm happy to accept the unnecessary risk of economy-breaking flash crashes if it means I can afford an extra shot of espresso once or twice a year.
  - Ekaros 3y ago
    Hmm, so let's say 50 saving, and over 40 years that would make 2000... Okay, not counting compounding interest. But on other hand how much wealth do they extract from the system? Is that more or less than the 2000 per person?
    - lotsofpulp 3y ago
      Considering that no one is stopping anyone from making an exchange that prohibits HFT, yet none exist is a pretty good signal that they extract less wealth than the value they provide.
  - AlbertCory 3y ago
    > Before HFT, stock exchanges couldn’t provide liquidity demonstrably false. "Liquidity" was available even before the dawn of networking. It was called "the ticker." Anyone with a ticker could see the last trade in a given stock. You could call your broker and he/she would convert your stock into cash (minus commission). It was just slower. As in Ticker Tape Parade. https://en.wikipedia.org/wiki/Ticker-tape_parade https://en.wikipedia.org/wiki/Ticker-tape_parade
- slashdev 3y ago
  The steelman argument is that it makes financial markets more efficient and decreases spreads, hence giving you better prices when you buy and sell. I think the reality is usually more complex and nuanced. Does it help your average retail investor more than it hurts? Maybe.
  - cameldrv 3y ago
    Either way, having the arbitrage between the U.S. and Euro markets be 9ms faster does absolutely nothing for anyone's 401k.
  - deleted 3y ago
    [deleted]
- growse 3y ago
  Large fund managers (e.g. Fidelity) disagree with you.
AlbertCory 3y ago
Maybe make a point here, if you have one?

Do you have a 401k?

AnimalMuppet 3y ago

I'm not the one you're asking, but yes, I do. So? Do you think the value of my 401k depends on HFT? I don't.

Spooky23 3y ago
Before HFT, stock exchanges couldn’t provide liquidity and wide spreads cost retail investors tens of dollars a year. When you retire, every time you go to Starbucks, you can rest assured that the savings on your 401k distribution will allow you get an extra shot, once a month. The innovators making this possible of course skim billions, but you get that free shot.
- candiddevmike 3y ago
  I don't think eliminating sub second stock trading would impact this scenario.
- cosmojg 3y ago
  > wide spreads cost retail investors tens of dollars a year. A veritable tragedy! I'm happy to accept the unnecessary risk of economy-breaking flash crashes if it means I can afford an extra shot of espresso once or twice a year.
- Ekaros 3y ago
  Hmm, so let's say 50 saving, and over 40 years that would make 2000... Okay, not counting compounding interest. But on other hand how much wealth do they extract from the system? Is that more or less than the 2000 per person?
  - lotsofpulp 3y ago
    Considering that no one is stopping anyone from making an exchange that prohibits HFT, yet none exist is a pretty good signal that they extract less wealth than the value they provide.
- AlbertCory 3y ago
  > Before HFT, stock exchanges couldn’t provide liquidity demonstrably false. "Liquidity" was available even before the dawn of networking. It was called "the ticker." Anyone with a ticker could see the last trade in a given stock. You could call your broker and he/she would convert your stock into cash (minus commission). It was just slower. As in Ticker Tape Parade. https://en.wikipedia.org/wiki/Ticker-tape_parade https://en.wikipedia.org/wiki/Ticker-tape_parade
slashdev 3y ago
The steelman argument is that it makes financial markets more efficient and decreases spreads, hence giving you better prices when you buy and sell. I think the reality is usually more complex and nuanced. Does it help your average retail investor more than it hurts? Maybe.
- cameldrv 3y ago
  Either way, having the arbitrage between the U.S. and Euro markets be 9ms faster does absolutely nothing for anyone's 401k.
- deleted 3y ago
  [deleted]
growse 3y ago
Large fund managers (e.g. Fidelity) disagree with you.

AlbertCory 3y ago

Maybe make a point here, if you have one?