High-Frequency Programmers Revolt Over Pay • Hacker News Board

Re: High-Frequency Programmers Revolt Over Pay

#171

Post by barrkel » Mon, Aug 02, 2010, 6:52 AM UTC

cturner wrote: post #170

barrkel wrote: post #169

Earlier quoted context omitted.

It reduces the size of the market for related goods, such as record sales, clothing, TV subscriptions, etc. by alienating poorer consumers. It hurts the brand, basically.

As I see it, I disagree that it alienates poorer consumers. Perhaps you were thinking along this line: that it discourages venues from offering coupon clipping discounts. It won't though: a venue has a fixed number of seats available, and will attempt to maximise its profit for this available volume of seats. If they're going to have leftovers, they'll find ways to discount out what's left. Scalping works against a v…

You're just focused on ticketing for a single event. What I'm saying is that it's about more than just tickets, and for more than just a single event.

I'm suggesting fans will be turned off of performers / entertainers / sports teams / etc. by the perception that they (the performers) are overcharging for their performance, and that will hurt the longevity of the brand, and the sales performance of related products.

Similarly, if you drive out youth and cater for wealthier older people in the interests of maximizing short-term revenue, you endanger brand engagement 10 or 20 years down the line - this is particularly important for sports clubs.

Re: High-Frequency Programmers Revolt Over Pay

#172

Post by kingcub » Mon, Aug 02, 2010, 2:20 PM UTC

adn37 wrote: post #165

kingcub wrote: post #143

Earlier quoted context omitted.

It's really hard to say without knowing the position. I've seen it go both ways. Some places it's the entry level get in the door while we evaluate you position and if you're good we'll move you over to trading. Some places it's all they ever want you to do with no opportunity to move to the trading side.

Interesting thread, thanks. As a Direct Market Access developer myself, I wonder what is your environment (target exchange(s), api/transport/codec stack, market data provider) and how time-costly it is for you to 'just connect' to the market (aka, having a platform ready to trade, without the algo stuff). Could you elaborate a little please?

Currently just the CME, all of it was written in house, with the exception of Quickfix for Java for sending orders and OpenFast for CME marketdata. We'd like to replace Quickfix in the near future as it has too much static singleton state for our liking. It takes a few months to a year to write the exchange connectivity pieces depending on how many times you've done it before. We've done it several times so we are pretty comfortable in that area. Subsequent exchanges are a lot easier once you have the basic infrastructure in place.

Re: High-Frequency Programmers Revolt Over Pay

#173

Post by anamax » Mon, Aug 02, 2010, 6:33 PM UTC

artsrc wrote: post #167

anamax wrote: post #24

Earlier quoted context omitted.

> More fuel than tank's holding capacity is pretty much useless. And what, exactly, is the "tank's holding capacity" for liquidity?

The volume real market participants want to buy or sell.

> The volume real market participants want to buy or sell.

What is the definition of "real market participant"?

For example, are day-traders real market participants? If not, why not?

How about me? (I rebalance every few months, maybe.)

Note that day traders and I have exactly the same goal - make money. How many people trade for other reasons?

Re: High-Frequency Programmers Revolt Over Pay

#174

Post by jaekwon » Fri, Aug 06, 2010, 12:13 PM UTC

artsrc wrote: post #147

yummyfajitas wrote: post #34

Earlier quoted context omitted.

Someone tries to buy an item for $1.00, and the HFT algorithm tries to grab the item first and resell it to our original buyer (and other people in the market) for just a tiny bit more. No. The matching engine will match first the highest priced order, and in the case of orders at the same price, whichever order was placed first. You can't jump ahead in the queue, no matter how fast your algorithm is [1]. [1] This st…

Current price $100. Firm puts in order to buy at any price up to $110. The HFC algorithm puts small volume sells to work out that they are doing that, then sell to them at $109.99. They then turn around and fill their position at any lower prices. If the HFC was not there the limit order would be filled more slowly at lower prices.

at no point is the stock any more "liquid" from the perspective of the firm.

Re: High-Frequency Programmers Revolt Over Pay

#175

Post by artsrc » Mon, Aug 09, 2010, 4:42 AM UTC

anamax wrote: post #173

artsrc wrote: post #167

Earlier quoted context omitted.

The volume real market participants want to buy or sell.

> The volume real market participants want to buy or sell. What is the definition of "real market participant"? For example, are day-traders real market participants? If not, why not? How about me? (I rebalance every few months, maybe.) Note that day traders and I have exactly the same goal - make money. How many people trade for other reasons?

If you can think of a better term than "real participant" please let me know.

If your job is to record or settle trades, be a day trader with no overnight position, track share holdings, etc. then you are a part of the machinery of this capital market, but you are not one of the participants who provides, or consumes capital. You are part of the cost structure.

The real participants are those who actions reflect beyond the casino itself, and out into the economy beyond.

The purpose of share markets is to provide capital. Long term capital for companies to invest, and in return to provide long term profits for those providing that capital.

If you are providing or consuming capital, even for one day, you are to some extent a real participant.

I think it is fine for people to make money, brokers to charge a fee for a trade, day trading, advising on diversification, etc.. But we should understand that these are costs associated with this system of providing capital/investing.

You sound like you provide capital and participate as an investor.