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TOPIC: HFT

HFT 1 year 2 months ago #1

  • kaveh
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I would like to point out a few things that your show missed.
Rather than worrying about 1 cent loss per share, investors should look at a longer term. Concentrate on the strategy, not 1 cent fluctuation.
1)HFTs first appeared back in the end of 90s. Computer trading algos appeared before that.
2) Citadel is a HFT.
3) on high liquid stocks, the spread is 1 cent. If HFTs font run you, it's only 1 cent.
4) If you have direct / level 2 access (thinkorswim.com) you can see all exchanges and participants. What scalpers are doing is similar to HFT. There, you can see 'games' they play (stuffing, bluffing on the bid/ask). Human did it long before HFT. HFT does it faster and more efficient.
5) HFT firms buy order flows from brokers. They depend lots on order flows.
6) Brokers can internalize your orders. Your orders may not hit any exchange.
7) You place a market order. You give your broker a blank check.
9)before 90s, the spread was often a few cents or more. Therefore, HFT does reduce the spread.
10) if there is a delay, the quote may be stale. Are we sure we get the current price if we go through a delay exchange? There is no way an average investor knows unless he/she has direct access. Until I can test an exchange out, I will hesitate to root for any exchange.
11) use limit order if you think HFT front run you.
12) I use direct access, the platform (that I use) always seek the best price from any exchange for me. I may get good price from IEX.
1987 crash, HFT wasn't there. The flash crash, Large hfts turned off, dried up liquidity.
Last Edit: 1 year 2 months ago by kaveh.
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HFT 1 year 2 months ago #2

  • kaveh
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more than 70% of funds are under performance (compare to indexes) at any given time.
The reason back then was computer algos.
Now it's HFT.
Buffet, Gates, Soros, Jones and many more make money with or without computer algos, HFT years after years. Nothing can beat a competence man.
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