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Goldman Sachs is spending $100M to shave milliseconds off stock trades

cnbc.com

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Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#241

Post by ausbah »

taspeotis wrote: post #225
ausbah wrote: post #222

To me this is incredibly ridiculous, millions more dumped into the brain draining maw of finance.

Forgive the AMP link but Bloomberg has a paywall of sorts now. https://www.google.com.au/amp/s/www.bloomberg.com/amp/opinio... > And while Scientel clearly has high-frequency trading in mind—“the name that keeps coming up among industry sources is Citadel”—that’s not all it has in mind. It’s a tower that can send signals for lots of stuff. “Scientel has said it will equip its Aurora tower with 28 antennas—24 for publ…

Reminds me of this comic

https://smbc-comics.com/index.php?id=3890

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#242

Post by randomsearch »

1e-9 wrote: post #110

Markets around the world are determining prices on a massive variety of instruments that derive value from the current and future value of products such as currencies, interest rates, equities, grains, livestock, metals, oil, gasoline, natural gas, and electricity. These prices allow us to prioritize resources, make fair transactions, and manage risk (i.e. buy insurance on the value of critical products so that we ca…

Is this sarcasm?

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#243

Post by ypcx »

IanDrake wrote: post #195
ypcx wrote: post #139

Earlier quoted context omitted.

The theory sounds great. But why then, our streets are lined with homeless, and our nations are stricken with poverty? Could it be that the only real aim and motivation of market traders is to earn money? One day, maybe.... when these are replaced with DAOs on the blockchain. But until then it's the Wolf of Wall Street.

Yes, the real aim and motivation of traders is to earn money and respect. What else should it be? Why pick on traders? I know a lot of developers making well into six figures. I hear them talking about getting 3 new graphics cards for their gaming rigs instead of how they worked at a soup kitchen. What is your point? That GS should be donating 100m to charity instead of reinvesting into their business? Where do you t…

I don't mean to pick on traders. Nominally it's a hard and honest job and money made is money deserved.

The problem is that if I have a company [and this is a systemic example, no exceptions, see #1], and I allow (central-)bank "friendly" people on its board, so that we can receive as many low- or zero-interest loans (with open due date or refinancing at will, i.e. free money, printed freshly from thin air) from the bank, so that we can under-price, destroy and acquire all our competition, become a monopoly AND finance a massive lobbying power in the DC so that we can get laws passed which increase our profits (at the disadvantage of the citizen), you can bet all your savings that such system's demise is written in the fabric of space and time, because the most essential feedback loops (and the ones that you mention, the ones in the market, work in exactly the opposite way) in that system have been disabled and its just a runaway train without brakes.

Buying laws starts and finances wars, relaxes food, water and environmental toxicity limits, enables false advertising, eventually raises taxes, enables trading of derivatives so detached from reality that a computer game pales in comparison, you name it. The days of this system are numbered and we should really speed up the development of trustless alternatives based on blockchain, or we're going to hit the wall really hard.

#1 https://www.newscientist.com/article/mg21228354-500-revealed...

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#244

Post by bumby »

Junk_Collector wrote: post #221
1e-9 wrote: post #110

Markets around the world are determining prices on a massive variety of instruments that derive value from the current and future value of products such as currencies, interest rates, equities, grains, livestock, metals, oil, gasoline, natural gas, and electricity. These prices allow us to prioritize resources, make fair transactions, and manage risk (i.e. buy insurance on the value of critical products so that we ca…

I just have a nitpick with your analogy to feedback loops. Assuming the market can be said to have a Nyquist rate, then once you hit that you have all relevant information. Increasing the sample rate past Nyquist does not make a system more stable unless you have a very specific system designed specifically to take advantage of that. More typically, it just increases your noise-bandwidth product and can decrease tota…

I agree with your comment but am curious on how far this analogy goes. What do you suppose defines the Nyquist frequency in a market?

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#245

Post by hpkuarg »

benaadams wrote: post #238
assblaster wrote: post #197

Earlier quoted context omitted.

Hundreds of millions of people have been brought out of poverty, outside the United States.

That's due to technology; not capitalism, they aren't the same thing. A huge amount of R&D happens in academia which isn't capitalism; but then is monetised by capitalism (but doesn't reinvest it back into the academia)

Converting that R&D into actual products and services, I'd wager, is quite difficult without a profit incentive. It's like the difference between having a great idea for a startup and actually turning it into a functioning company.

Without invoking too many absolutes, there's so much bullshit involved in the latter that people doing the former aren't willing to put up with. It's mostly two different kinds of people with two different skillsets.

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#246

Post by jodrellblank »

_fol8 wrote: post #210
1e-9 wrote: post #110

Markets around the world are determining prices on a massive variety of instruments that derive value from the current and future value of products such as currencies, interest rates, equities, grains, livestock, metals, oil, gasoline, natural gas, and electricity. These prices allow us to prioritize resources, make fair transactions, and manage risk (i.e. buy insurance on the value of critical products so that we ca…

[flagged]

Reading that and getting hooked on the narrative because the whole thing sounds like the workings of a giant AI brain and is too cool to refute, then they quietly tack on "and beneficial to the economy"; we economic laypeople are supposed to take that on faith, as if hearing a theologian prescribe how to live and concluding with "and beneficial to your immortal soul". Who are we to argue?

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#247

Post by dalbasal »

lallysingh wrote: post #177
dalbasal wrote: post #140

Earlier quoted context omitted.

The upshot of this argument is that this is valuable activity. We need markets to price tradable assets and provide liquidity. The counterargument is that there are diminishing and/or negative returns to increased liquidity and velocity. Take just stocks. Liquidity is not a problem. You have liquidity whether trades take minutes or milliseconds. Pricing? I'd say we have pricing covered too, at least the pricing that…

> Meanwhile, all this stuff costs money, people, resources that aren't available for actual productive work instead of overhead. That's a very high standard. What's productive? What's productive enough, in your book, to be worth the effort used here?

Median productiveness is plenty, assuming this is not productive activity.

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#248

Post by jodrellblank »

WanderPanda wrote: post #124
1e-9 wrote: post #110

Markets around the world are determining prices on a massive variety of instruments that derive value from the current and future value of products such as currencies, interest rates, equities, grains, livestock, metals, oil, gasoline, natural gas, and electricity. These prices allow us to prioritize resources, make fair transactions, and manage risk (i.e. buy insurance on the value of critical products so that we ca…

This system is the only one unbiased estimator / decision maker humans ever found. Though it has quite high variance, in the long-term its results are just astounding

If it's unbiased, that's the same as saying it's random?

If it leads towards efficiency, productivity, most beneficial allocation, as suggested, those are all biases.

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#249

Post by bumby »

benaadams wrote: post #238
assblaster wrote: post #197

Earlier quoted context omitted.

Hundreds of millions of people have been brought out of poverty, outside the United States.

That's due to technology; not capitalism, they aren't the same thing. A huge amount of R&D happens in academia which isn't capitalism; but then is monetised by capitalism (but doesn't reinvest it back into the academia)

Doesn't capitalism either directly or indirectly fund that academic research? When I was in a university lab, all of my work was funded by private companies

Re: Goldman Sachs is spending $100M to shave milliseconds off stock trades

#250

Post by dalbasal »

kortilla wrote: post #164
dalbasal wrote: post #140

Earlier quoted context omitted.

The upshot of this argument is that this is valuable activity. We need markets to price tradable assets and provide liquidity. The counterargument is that there are diminishing and/or negative returns to increased liquidity and velocity. Take just stocks. Liquidity is not a problem. You have liquidity whether trades take minutes or milliseconds. Pricing? I'd say we have pricing covered too, at least the pricing that…

>that aren't available for actual productive work instead of overhead. That’s a very biased view. Another view would be that improving the efficiency of the largest markets in the world have a much larger positive impact on society than the vast majority of the “productive” work you refer to.

It's biased to the premise, which is that "day trading's" contribution to price efficiency & liquidity are of diminishing value, and that the marginal value is essentially 0 or negative.
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