The $440M software error at Knight Capital (2019) • Hacker News Board

Re: The $440M software error at Knight Capital (2019)

#161

Post by snapcaster » Tue, May 03, 2022, 12:27 PM UTC

ricardobeat wrote: post #114

vmception wrote: post #31

Earlier quoted context omitted.

like how Credit Suisse is going to reverse their Bill Hwang losses? I guess in this conversation we can't distinguish from irreversible asset value and liquidity issue to misdirected transactions that inherit partial reversibility. similarly, maybe you/they just don't see the headlines of thwarted attacks in DeFi that work specifically due to design considerations. I'll take the permission to fail. The rapid iteratio…

Where is this innovation happening? We’ve had crypto for 13 years now, and just yesterday we had people flat out losing 10k into the ether because their transaction “ran out of gas” without completing. Isn’t that plenty of time to develop systems that avoid basic issues like suddenly burning all your money?

I'm generally skeptical of ethereum but i don't think this claim is quite right. First, they didn't lose 10k "into the ether" it just went to miners as a fee for processing their transaction. Additionally, the fee was paid for priority. There is a limited amount of block space so people can pay extra to make sure they're included. I know it's cliche but this is literally a feature not a bug

Re: The $440M software error at Knight Capital (2019)

#162

Post by charcoalhobo » Tue, May 03, 2022, 1:40 PM UTC

smcl wrote: post #154

kevstev wrote: post #45

Earlier quoted context omitted.

Yeah, pay at the big banks is shit really, especially when you consider the utter lack of work/life balance. I left in 2013 making 150k, which was supposed to be supplemented by a ~40% bonus for the level I was at, but each year was "well its been a tough year..." and after getting a token amount one year, and then zeroes the next 2, after working 50-60 hour weeks, I was like I am not only done with this place, but t…

>> Then when we get to talking numbers they're like "300k a year". > Yeah, pay at the big banks is shit really I would say that a $300,000/year salary is really quite far from "shit". Many jobs are stressful, demanding or unrewarding but rarely do they provide such a salary, and quite often they offer hourly wages hovering around minimum wage with poor benefits. It's worth taking a step back once in a while to think…

This is a welcome bit of perspective, so thank you for that.

I often find myself complaining about things at work like competing priorities or wearing too many hats and it helps me to ground myself by thinking about past jobs at minimum wage or even watching what people making less than a fifth of my salary have to put up with on a daily basis.

Re: The $440M software error at Knight Capital (2019)

#163

Post by kevstev » Tue, May 03, 2022, 1:55 PM UTC

22SAS wrote: post #53

caffeine wrote: post #38

Earlier quoted context omitted.

The attitude that finance pays more is a leftover from a previous era. 10-15 years ago it was true: the profits from HFT were so also way, way bigger and split up amongst a much smaller group of firms. Now those firms are all in a completely competitive industry squeezing each other for basis points. Meanwhile the definition of a FAANG is that it has an effective monopoly, and these companies are taking in way more m…

Tbf, most of us don't really prefer to be called as HFT's but as Market Makers. Different name, but we still use the same ultra low latency techniques to get the job done.

I worked in option AMM when the term HFT started getting thrown around in some articles, and was discussed as this uber secret hush hush thing, and I was interested. I was then astonished when I kept reading and found out that it was what I had been doing- it was just another name for market making really...

Re: The $440M software error at Knight Capital (2019)

#164

Post by sjtindell » Tue, May 03, 2022, 2:50 PM UTC

smcl wrote: post #154

kevstev wrote: post #45

Earlier quoted context omitted.

Yeah, pay at the big banks is shit really, especially when you consider the utter lack of work/life balance. I left in 2013 making 150k, which was supposed to be supplemented by a ~40% bonus for the level I was at, but each year was "well its been a tough year..." and after getting a token amount one year, and then zeroes the next 2, after working 50-60 hour weeks, I was like I am not only done with this place, but t…

>> Then when we get to talking numbers they're like "300k a year". > Yeah, pay at the big banks is shit really I would say that a $300,000/year salary is really quite far from "shit". Many jobs are stressful, demanding or unrewarding but rarely do they provide such a salary, and quite often they offer hourly wages hovering around minimum wage with poor benefits. It's worth taking a step back once in a while to think…

I believe that technology and other workers who are paid these salaries are actually just the only workers lucky enough to be getting a fraction of what is their fair share. You shouldn’t let a CEO walk with 300x their workers wage and say “well at least I’m not in poverty like those other workers”. You should almost always fight for more.

Re: The $440M software error at Knight Capital (2019)

#165

Post by 2ICofafireteam » Tue, May 03, 2022, 2:53 PM UTC

zeven7 wrote: post #145

grouseway wrote: post #127

Earlier quoted context omitted.

Never? You guys don't use the BEDMAS acronym in grade school for teaching order of operations? I've only ever called them brackets.

Yeah, never. PEMDAS for sure. What part of the country were you in where you got BEDMAS?

FWIW, I did my schooling on the West coast of British Columbia in the early 90's and it was BEDMAS.

Re: The $440M software error at Knight Capital (2019)

#166

Post by revel » Tue, May 03, 2022, 2:58 PM UTC

kevstev wrote: post #45

fullsend wrote: post #29

Earlier quoted context omitted.

I appreciate your comment about pay. Recruiters will often tell me "it's finance so of course the pay will be substantial." Then when we get to talking numbers they're like "300k a year". Oh, you mean the going rate at a FAANG? And I have to move to New York or Chicago, work more hours, and actively work for people who I know are taking home paychecks with 7+ zeroes on them? Come on. Sometimes it's 400 plus bonus or…

Yeah, pay at the big banks is shit really, especially when you consider the utter lack of work/life balance. I left in 2013 making 150k, which was supposed to be supplemented by a ~40% bonus for the level I was at, but each year was "well its been a tough year..." and after getting a token amount one year, and then zeroes the next 2, after working 50-60 hour weeks, I was like I am not only done with this place, but t…

Sounds like I had a similar experience to you, except many years prior. I actually worked on a desk where there was a front page-headline scandal, partly caused by lack of investment in tech. I would never recommend anyone work in finance based on my experiences, but most people get very excited and assume it was fun and lucrative work. It was neither.

I heard, on multiple occasions from senior leadership, that industry practice was to categorize all dev work as IT so they could justify lower compensation. Pay was, just as you pointed out, not the main problem with this setup. There was no respect for other people and individuals were frequently berated or humiliated for no reason.

One interesting observation: despite the fact that I am very well qualified to work in the sector, it's very rare for fintech recruiters to reach out to me. They must know that I'm far out of their pay grade now and will never go back.

Re: The $440M software error at Knight Capital (2019)

#167

Post by 22SAS » Tue, May 03, 2022, 3:22 PM UTC

kevstev wrote: post #163

22SAS wrote: post #53

Earlier quoted context omitted.

Tbf, most of us don't really prefer to be called as HFT's but as Market Makers. Different name, but we still use the same ultra low latency techniques to get the job done.

I worked in option AMM when the term HFT started getting thrown around in some articles, and was discussed as this uber secret hush hush thing, and I was interested. I was then astonished when I kept reading and found out that it was what I had been doing- it was just another name for market making really...

Yep. At the end it is market making, in markets where speed is of the essence to be competitive. Funny thing is, now firms in the industry want to be termed as Market Makers rather than HFT since the media has turned HFT into a very negative term.

Re: The $440M software error at Knight Capital (2019)

#168

Post by 22SAS » Tue, May 03, 2022, 3:24 PM UTC

4jsfgja5aj wrote: post #160

renewiltord wrote: post #143

Earlier quoted context omitted.

7 figs is 6 zeroes in his lingo, right? My man is looking for 8 figures.

Yes, exactly, and nomenclature borrowed from the parent. (This is another throwaway, and I am responding.) > > "...all about making $$ for the firm. If the strategies developed..." The topic here is on offers to new hires -- not value delivered after time and work invested. Offers at market rate -- even in the FAANG world -- are not at 7 figures (6 zeros), definitely not at 10x that, and certainly not before the new…

I am sorry, I misread it as getting to those numbers as an employee at a trading firm rather than as an applicant. I agree with you. The very, very rare cases where this has happened is for people with exceptional records elsewhere, and many times they are joining new places as partners rather than a regular employee.

Re: The $440M software error at Knight Capital (2019)

#169

Post by 22SAS » Tue, May 03, 2022, 3:25 PM UTC

skippyboxedhero wrote: post #110

22SAS wrote: post #57

Earlier quoted context omitted.

Most quantitative hedge funds and prop trading firms are now following a very tech like culture since they realize now that technology is just as important as the strategies. To get the best engineers, especially from FAANG, they need to have a similar culture otherwise they'll have a hard time getting new hires.

It depends what the strategy is. Frankly, a lot of what people refer to as "prop trading firms" and "quant hedge funds" on here are just market-makers...they are taking very little to no risk, a lot are just riding the wave of ETF growth. Even the ones that are running alpha, I have heard of a few strategies, and they are largely what you would expect: low-edge, crowded trades (frankly, a lot of it is LTCM-style stuf…

Interesting, would you add RenTech and TGS into the "traditional hedge funds that incorporated quant methods into a fundamental process" bucket?

Re: The $440M software error at Knight Capital (2019)

#170

Post by caffeine » Tue, May 03, 2022, 6:10 PM UTC

22SAS wrote: post #167

kevstev wrote: post #163

Earlier quoted context omitted.

I worked in option AMM when the term HFT started getting thrown around in some articles, and was discussed as this uber secret hush hush thing, and I was interested. I was then astonished when I kept reading and found out that it was what I had been doing- it was just another name for market making really...

Yep. At the end it is market making, in markets where speed is of the essence to be competitive. Funny thing is, now firms in the industry want to be termed as Market Makers rather than HFT since the media has turned HFT into a very negative term.

Back when Flash Boys came out, we all started calling each other Flash Boys. There was then a serious proposal to rename one of the strategies (the hedger, for added irony) Grandma Annihilator 3000.

When the KCG thing came out, one of the new grads was renamed “Power Peg” for a few weeks.

I miss the 2010s. It was a lot more fun when people leaned into stuff instead of being scared all the time.