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So what specific part of HFT operation makes them able to do that? Is it their own (really public) instance of Core War (https://en.wikipedia.org/wiki/Core_War

by pgeorgi 12y ago

So what specific part of HFT operation makes them able to do that? Is it their own (really public) instance of Core War (https://en.wikipedia.org/wiki/Core_War https://en.wikipedia.org/wiki/Core_War)? Is it the milliseconds advantage gained through custom transatlantic fiber? If either of these aren't core to what enables them to dump prices, we could get them down even more by getting rid of these toys.

deleted 12y ago
[deleted]
lmm 12y ago
> So what specific part of HFT operation makes them able to do that? Lower costs by having computer programs rather than human traders. Two or three programmers can do the trading that would previously have taken a hundred traders, and there's a corresponding saving in salary/bonuses/etc. > If either of these aren't core to what enables them to dump prices, we could get them down even more by getting rid of these toys. How would you do that? Having algorithms is core to it. Having custom fiber is only core to beating the other HFTs (they can't compete on price so they compete on latency), but what are you going to do, pass a law against installing optical fibres? Prices are already as low as they're legally allowed to be (sub-penny rule). Which is what causes a lot of the weird millisecond-chasing.