Goldman Sachs will open-source some of its trading software • Hacker News Board

Re: Goldman Sachs will open-source some of its trading software

#61

Post by ohaideredevs » Wed, Apr 03, 2019, 6:02 PM UTC

gcb0 wrote: post #57

gringoDan wrote: post #54

Earlier quoted context omitted.

If [0] those returns are accurate, can be proven, and your strategy can be scaled up to multi-million dollar positions, you should take it to a hedge fund/prop shop/etc. and be able to make 7 or 8 figures. Your bonus should be dependent on performance; you may be able to negotiate a % of the profit. Those companies don't care about your background if at the end of the day you make them money. [0] Granted, that's a hu…

and how do you prove some method scale up without either already being on the million dollar scale or disclosing your secret sauce?

The reason financial transactions don't scale is volume - your $100 trade can move a penny stock to $.02 from $.0002 a share if there is no volume.

Some markets can absorb an enormous amount of volume, such as the FOREX market.

Now, when you start making good trades in a "big" market, intelligent players can mimic / play off of them, so it is hard to prove in that regard.

At a minimum though, you could prove that it works on assets that are not volume-dependent.

Re: Goldman Sachs will open-source some of its trading software

#62

Post by jkchu » Wed, Apr 03, 2019, 6:06 PM UTC

kyleblarson wrote: post #46

Anyone who thinks GS is taking any action without the intent of profiting from said action is hopelessly naive.

But them making a decision to benefit themselves is not necessarily mutually exclusive to a decision that benefits other developers and the OSS community. Your point is valid, but just want to clarify that it isn't necessarily all negative.

Re: Goldman Sachs will open-source some of its trading software

#63

Post by g6nhe9twPd66 » Wed, Apr 03, 2019, 6:20 PM UTC

orev wrote: post #28

voisin wrote: post #3

This is quite a change from when they ruined a man’s life for using Github.

It was actually subversion and that was part of the case against him, using the dictionary definition of “subversion” to prove malicious intent.

It didn't help that he cleared his bash history making it look like he was concealing his actions.

Re: Goldman Sachs will open-source some of its trading software

#64

Post by user5994461 » Wed, Apr 03, 2019, 6:21 PM UTC

lordnacho wrote: post #33

pantaloons wrote: post #15

Of course, if this technology was able to price securities better than the market (the fundamental job of almost every market participant), it would be printing money and they would not release it. This is not the secret sauce, but probably an implementation of a set of standard well known pricing and risk models. That's still useful, and can be expensive to develop, so thanks Goldman.

> the fundamental job of almost every market participant Not true. You might make an argument that this is the effect of having them together in a market, but that's not their job: - Market maker: hang around the market offering to trade with anyone (pref retail) at a spread. Doesn't care whether TSLA is gonna be able to make all those Model 3s. - Pension fund: make sure they can pay the liabilities that are coming d…

One little correction.

Hedge Fund: Convince customers to invest their money in the fund. Extract as much of it as possible through fees. Doesn't care much where the market goes, charge a fee either way, a bit more if it goes up.

Re: Goldman Sachs will open-source some of its trading software

#65

Post by user5994461 » Wed, Apr 03, 2019, 6:24 PM UTC

ionwake wrote: post #53

lordnacho wrote: post #33

Earlier quoted context omitted.

> the fundamental job of almost every market participant Not true. You might make an argument that this is the effect of having them together in a market, but that's not their job: - Market maker: hang around the market offering to trade with anyone (pref retail) at a spread. Doesn't care whether TSLA is gonna be able to make all those Model 3s. - Pension fund: make sure they can pay the liabilities that are coming d…

Hope you dont mind me asking a slightly unrelated and possibly dumb question. Im a programmer, but on the side have made on average 150% profit in share dealing over the passed 5 years, but more importantly, a much higher return in other assets to 2 orders of magnitude higher. My question is - would experience / gains like this - if i had proof etc - get me an interview in a fund as some type of well paid (6 figure a…

You mean +50 or +150% ?

Either way, it's insignificant and you're actually losing money. The stock of all the big companies went up tremendously in the past 5 years. Anybody who invested in large US equities made just as much if not more.

Re: Goldman Sachs will open-source some of its trading software

#66

Post by alkibiades » Wed, Apr 03, 2019, 6:32 PM UTC

kyleblarson wrote: post #46

Anyone who thinks GS is taking any action without the intent of profiting from said action is hopelessly naive.

that can be said of any corporation. or most humans

Re: Goldman Sachs will open-source some of its trading software

#67

Post by mactrey » Wed, Apr 03, 2019, 6:39 PM UTC

alkibiades wrote: post #66

kyleblarson wrote: post #46

Anyone who thinks GS is taking any action without the intent of profiting from said action is hopelessly naive.

that can be said of any corporation. or most humans

Or any life form, really.

Re: Goldman Sachs will open-source some of its trading software

#68

Post by JackFr » Wed, Apr 03, 2019, 6:58 PM UTC

jen20 wrote: post #26

kranner wrote: post #22

Earlier quoted context omitted.

Investment banks have proprietary trading desks that are effectively hedge funds.

GS used to be nicknamed “the worlds largest hedge fund”. They have plenty of world class proprietary tech, but the OP is right: this is not likely to be secret sauce at all.

That's Harvard's endowment. Harvard University itself exists at this point merely as a tax dodge for the $37 billion AUM hedge fund.

Re: Goldman Sachs will open-source some of its trading software

#69

Post by vortico » Wed, Apr 03, 2019, 6:59 PM UTC

kyleblarson wrote: post #46

Anyone who thinks GS is taking any action without the intent of profiting from said action is hopelessly naive.

It's likely not a huge profit decision, and the path to profit is likely very indirect. They did it probably because

- it increases its brand awareness/respect for technical customers, potential job candidates, and business partners

- it can teach finance and CS students about basic algorithms used in the industry. In some industries, it is healthier for a company's technical edge to not be so far ahead of competitors.

- the open-source """community""" (whatever that is) can find bugs and extend the software for the benefit of GS. I highly doubt this is a motive, but it's a possibility/daydream.

Re: Goldman Sachs will open-source some of its trading software

#70

Post by mortdeus » Wed, Apr 03, 2019, 7:01 PM UTC

What about that dude who they put in jail for open sourcing software he developed in a personal side project while under contract with them?

Didn't they like completely throw the book at him by charging him under that completely insane law the Computer Fraud Act?