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Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

bloomberg.com

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Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#21

Post by modeless »

sargun wrote: post #15

I remain convinced that this is Starlink's short-term customer if their promises are true. They are doing transmission via optical as the crow flies. If they're doing O-O, or even low latency O-E-O, they can beat transatlantic fiber. For HFT houses, that's potentially a major edge.

Starlink latency would be worse than shortwave. The advantage would be bandwidth, but I doubt that high bandwidth is really helpful for this application, especially if you have to give up a tiny bit of latency for it. After all, you can already have all the bandwidth you want with only slightly higher latency.

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#22

Post by rvense »

musicale wrote: post #8

It's weird that we've set up a stock market for machines rather than humans, where ever-faster bots interpose themselves between slightly slower bots, all the way up to the original buyer and seller, who are probably bots as well.

This all sounds so perverse to me. There are so many obviously brilliant people working on these things. Why aren't they doing something productive with their time? Fighting climate change, educating uneducated, feeding the unfed. All the energy and rare and bloody minerals that are being put into these radios, all the drinking water that will be forever tainted after having been used to produce the semiconductors needed for all this... was it really the best place to use it? To make the roulette wheel run a little faster? I don't understand it.

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#23

Post by oh_sigh »

sargun wrote: post #15

I remain convinced that this is Starlink's short-term customer if their promises are true. They are doing transmission via optical as the crow flies. If they're doing O-O, or even low latency O-E-O, they can beat transatlantic fiber. For HFT houses, that's potentially a major edge.

What happens in the global market if a single person consistently has a timing advantage over every other participant(because the barrier to building a global satellite network is too high/costly for anyone else)? Could Elon come to own the entire market, or is there some limit to the powers of arbitrage?

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#24

Post by Erlich_Bachman »

rvense wrote: post #22
musicale wrote: post #8

It's weird that we've set up a stock market for machines rather than humans, where ever-faster bots interpose themselves between slightly slower bots, all the way up to the original buyer and seller, who are probably bots as well.

This all sounds so perverse to me. There are so many obviously brilliant people working on these things. Why aren't they doing something productive with their time? Fighting climate change, educating uneducated, feeding the unfed. All the energy and rare and bloody minerals that are being put into these radios, all the drinking water that will be forever tainted after having been used to produce the semiconductors ne…

You won't like it, but the there is a sensible answer for this. Despite you not liking the stock (and other financial) markets, they do perform a useful and needed task (price discovery, reallocation of resources, reallocation and focusing of human brainpower, reallocation of capital, allowing for investment (allocation of collected capital and resources in the present for future projects, so that they can be achieved faster, and thus provide overall better output of the system)), and even speculation is also an important part of that task.

It is not needless greed (as popularized by some movies and pop culture), it is an engine of the capitalist civilisation, which has so far produced far more results (even in less obvious terms like allowing for least poverty in the world than any other time in history, because the benefits of a well-functiouning society do evidently trickle down to the the little guy, even if the most of it is collected at the top) than any other.

There is indeed some meaningless speculation in it, just like how there is corruption in all of human systems, and just how in every ecosystem there are a number of parasites, but they are there because the underlying system (capitalism) is meaningful and produces value for society.

> feeding the unfed

They do feed the unfed. The capitalist system has been able to reduce world poverty by far far more than any other system in history. Look at the stats. And well-functioning capital, labor, idea and resource circulation markets are at the very heart of that system.

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#25

Post by rvense »

Erlich_Bachman wrote: post #24
rvense wrote: post #22

Earlier quoted context omitted.

This all sounds so perverse to me. There are so many obviously brilliant people working on these things. Why aren't they doing something productive with their time? Fighting climate change, educating uneducated, feeding the unfed. All the energy and rare and bloody minerals that are being put into these radios, all the drinking water that will be forever tainted after having been used to produce the semiconductors ne…

You won't like it, but the there is a sensible answer for this. Despite you not liking the stock (and other financial) markets, they do perform a useful and needed task (price discovery, reallocation of resources, reallocation and focusing of human brainpower, reallocation of capital, allowing for investment (allocation of collected capital and resources in the present for future projects, so that they can be achieve…

> And well-functioning capital, labor, idea and resource circulation markets are at the very heart of that system.

Sure. But I'd question whether high-frequency trading is a necessary component of that, as opposed to regular-frequency trading. Same as I'd question whether things like collateralized debt obligations and interest-free loans were good for the housing market.

"Capitalist civilization" has changed in a number of ways since Reagan and Thatcher, just in its legal framework, compared to the thirty years before and I don't think it's obvious at all that we are better off in the developed world than we were in the fifties and sixties when things were more regulated.

When I look at stats for things like wage disparities, and the amount of money poured into marketing (demand generation), and the amount of frivolous products that the capitalist economy produces because it must by its nature constantly expand production, I quite honestly don't see efficiency and I certainly don't see reason.

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#26

Post by adrianN »

missedthecue wrote: post #10
musicale wrote: post #8

It's weird that we've set up a stock market for machines rather than humans, where ever-faster bots interpose themselves between slightly slower bots, all the way up to the original buyer and seller, who are probably bots as well.

The machines help humans. The bid/ask spread on a $100 share in 1970 as $5. Now it's $0.003 cents and it will continue to narrow, saving you and I money.

How big would it be if we limited machine trading such that milliseconds don't matter? Say run everything with 1Hz frequency instead?

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#28

Post by jmnicolas »

Erlich_Bachman wrote: post #24
rvense wrote: post #22

Earlier quoted context omitted.

This all sounds so perverse to me. There are so many obviously brilliant people working on these things. Why aren't they doing something productive with their time? Fighting climate change, educating uneducated, feeding the unfed. All the energy and rare and bloody minerals that are being put into these radios, all the drinking water that will be forever tainted after having been used to produce the semiconductors ne…

You won't like it, but the there is a sensible answer for this. Despite you not liking the stock (and other financial) markets, they do perform a useful and needed task (price discovery, reallocation of resources, reallocation and focusing of human brainpower, reallocation of capital, allowing for investment (allocation of collected capital and resources in the present for future projects, so that they can be achieve…

Your idealistic vision of the stock markets doesn't hold well to the reality of the Fed literally price fixing everything under the sun so that we don't experience the biggest crash since 1929.

Right now there is no price discovery, all stocks are way overpriced.

While mainstreet is going in flames, wallstreet acts like everything is peachy and jumps on any rumor of a hint of a possibility that someone somewhere might someday have something that look like the possibility of a COVID vaccine (looking at you Gilead scam).

This won't end well (imo).

Re: Companies Pitch Shortwave Radio to Shave Milliseconds Off Trades

#29

Post by hef19898 »

modeless wrote: post #21
sargun wrote: post #15

I remain convinced that this is Starlink's short-term customer if their promises are true. They are doing transmission via optical as the crow flies. If they're doing O-O, or even low latency O-E-O, they can beat transatlantic fiber. For HFT houses, that's potentially a major edge.

Starlink latency would be worse than shortwave. The advantage would be bandwidth, but I doubt that high bandwidth is really helpful for this application, especially if you have to give up a tiny bit of latency for it. After all, you can already have all the bandwidth you want with only slightly higher latency.

If memory works well, they have dedicated glass fibre for bandwidth, at least between Chicago and NY. Took the closest possible distance.

Microwave is used for speed, in addition, to get binary signals from A to B. I heard that theory more than once about Starlink, it just doesn't make that much sense to me. Starlink could also be, of course, a clever way of getting

a) enough launches to make reusable rockets financially feasible

and/or

b) getting financing for SpaceX

Quite some other companies trying the same went under recently.

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