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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

#91

Post by rolltiide »

JudgeWapner wrote: post #7

Tangentially related, but I wonder how long before HFT harnesses neutrino transmission to send market data directly through the earth? The MINOS [1] project is underway to send neutrinos from Fermilab in Illinois to detectors in northern Minnesota. Straight through the earth's crust. Detecting neutrinos is hard, and modulating data on them will probably be even more difficult, but if it shaves a few micro/millisecond…

That doesn't seem like it would be actually faster or closer for NYC to HK/Shanghai, close but not a latency improvement at the speed of light? Well I guess if a direct line can be made itll shave off some milliseconds

Maybe less infrastructure required.

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

#92

Post by ctack »

eecc wrote: post #75
nickles wrote: post #37

Earlier quoted context omitted.

Adding to this, HFT is a product of rule 612 of Reg NMS (the sub-penny rule). Markets are not allowed to show quotes in increments of less than $0.01 for most names. Since traders cannot compete on price, they have been forced to compete exclusively on speed. The impact of such regulation was tested by the SEC recently with the 'tick size' program. Instead of reducing the minimum increment, some names saw it increase…

What’s the minimum lag for a packet to reach around the world? Multiply x2 and add an extra 10%. Make that the minimum order placement tick duration. There would be 1 single global price and no arbitrage between markets possible.

I imagine that no one with any clout is petitioning for a more equal platform.

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

#93

Post by collyw »

codingslave wrote: post #17

People love to rail on HFT, but at this point, its really not that profitable. It's just a reality of trading in the markets. There was a blip of time between 2008 and 2014 when HFT was extremely profitable. Those inefficiencies have been gone from the market for years. People were whooped into anger about how much money was being made, at this point its a complete non issue and needs to be removed from the highlight…

>People love to rail on HFT

probably because it's difficult to see any actual value that this provides to society.

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

#94

Post by [deleted] »

collyw wrote: post #93
codingslave wrote: post #17

People love to rail on HFT, but at this point, its really not that profitable. It's just a reality of trading in the markets. There was a blip of time between 2008 and 2014 when HFT was extremely profitable. Those inefficiencies have been gone from the market for years. People were whooped into anger about how much money was being made, at this point its a complete non issue and needs to be removed from the highlight…

>People love to rail on HFT probably because it's difficult to see any actual value that this provides to society.

[deleted]

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

#95

Post by reallydontask »

collyw wrote: post #93
codingslave wrote: post #17

People love to rail on HFT, but at this point, its really not that profitable. It's just a reality of trading in the markets. There was a blip of time between 2008 and 2014 when HFT was extremely profitable. Those inefficiencies have been gone from the market for years. People were whooped into anger about how much money was being made, at this point its a complete non issue and needs to be removed from the highlight…

>People love to rail on HFT probably because it's difficult to see any actual value that this provides to society.

> probably because it's difficult to see any actual value that this provides to society.

Doesn't this apply to a majority of activities in the financial sector?

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

#96

Post by Retric »

phildawes wrote: post #87
eecc wrote: post #75

Earlier quoted context omitted.

What’s the minimum lag for a packet to reach around the world? Multiply x2 and add an extra 10%. Make that the minimum order placement tick duration. There would be 1 single global price and no arbitrage between markets possible.

What about order cancels - would you similarly limit those?

Yes, the ability to cancel an order now vs 1 second from now is not that meaningful. Or as the general public is concerned ‘If you’re directly placing orders on the stock market you can ware your big boy paints.’

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

#97

Post by codingslave »

collyw wrote: post #93
codingslave wrote: post #17

People love to rail on HFT, but at this point, its really not that profitable. It's just a reality of trading in the markets. There was a blip of time between 2008 and 2014 when HFT was extremely profitable. Those inefficiencies have been gone from the market for years. People were whooped into anger about how much money was being made, at this point its a complete non issue and needs to be removed from the highlight…

>People love to rail on HFT probably because it's difficult to see any actual value that this provides to society.

Its just a cost of doing business, something you have to deal with when trading securities electronically.

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

#98

Post by fooker »

reallydontask wrote: post #95
collyw wrote: post #93

Earlier quoted context omitted.

>People love to rail on HFT probably because it's difficult to see any actual value that this provides to society.

> probably because it's difficult to see any actual value that this provides to society. Doesn't this apply to a majority of activities in the financial sector?

No, a large fraction of modern tech and companies would not exist without the 'activities in the financial sector'.

Essentially any endeavor requiring capital beyond your means would have to be bootstrapped or required borrowing money at exorbitant rates. There is a reason the financial sector exists. It makes money by selling convenience and taking over quantified risk.

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

#99

Post by snovv_crash »

saberdancer wrote: post #89
habnds wrote: post #78

Earlier quoted context omitted.

people aren't mad only because tons of money is made on hft. It's also because money is _wasterd_ on hft. That's $100 million dollars spent on something that has 0 use to society. It's just rich people playing weird games. Think about the social benefits of $100 million invested in nyc transit infrastructure. The economy's incentive structure is broken and this is a prime example.

Those 100m are not destroyed by burning them in an HFT furnace but rather used to pay developers, hardware, factory workers etc. Sure, it's not going directly into infrastructure but it is not lost. In fact, it's quite possible that if it wasn't invested into HFT it would be held as cash by the company or paid out as a dividend (which is fine as well).

That is false. The 100m could have been spent on something which increases the productivity of people. It would still go to devs, factories, etc but at the end there is something from which society benefits.

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

#100

Post by stakhanov »

reallydontask wrote: post #95
collyw wrote: post #93

Earlier quoted context omitted.

>People love to rail on HFT probably because it's difficult to see any actual value that this provides to society.

> probably because it's difficult to see any actual value that this provides to society. Doesn't this apply to a majority of activities in the financial sector?

Doesn't this apply to a majority of activities, period? (See recent discussions on "bullshit jobs")?
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