[HN Gopher] Jump Trading, Virtu and the 'hidden optical fibre ca...
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Jump Trading, Virtu and the 'hidden optical fibre cable' under an
Ohio field
Author : throwaway2037
Score : 33 points
Date : 2024-10-28 08:46 UTC (1 days ago)
(HTM) web link (www.ft.com)
(TXT) w3m dump (www.ft.com)
| throwaway2037 wrote:
| FT Alphaville: High frequency trading
|
| Skywave Networks accuses Wall Street titans of 'continuous
| racketeering and conspiracy'
|
| FT/Alphaville is blog attached to The Financial Times newspaper.
| It free to sign-up for an account.
| brudgers wrote:
| https://archive.ph/2vQm6
| dinkblam wrote:
| why would a radiowave that is reflected off the atmosphere (and
| therefore taking the longer route) be faster than a direct fibre
| cable?
| FredFS456 wrote:
| Speed of light in an optical fibre is about 2/3 that of the
| speed in air
| scrlk wrote:
| Radio waves travel at nearly the speed of light, whereas light
| in an fiber optic cable travels at ~67% of the speed of light
| due to the refractive index of glass.
| cypherpunks01 wrote:
| Ericsson blog wrote:
|
| _In a vacuum, electro-magnetic waves travel at a speed of
| 3.336 microseconds (ms) per kilometer (km). Through the air,
| that speed is a tiny fraction slower, clocking in at 3.337 ms
| per km, while through a fiber-optic cable it takes 4.937 ms
| to travel one kilometer - this means that microwave transport
| is actually 48% faster than fiber-optic, all other things
| being equal._
| _qua wrote:
| Light doesn't go at light speed through optical fiber.
| AStonesThrow wrote:
| By definition, it does, because the maximum speed is
| qualified by "the speed of light in a vacuum", so the speed
| of light [in other media] is simply a function of how much
| the medium slows it down, yet it is still the speed of light.
| Funny how that works!
| nimish wrote:
| Sure it does. It's just that the speed of light in non-hollow
| optical fiber is slower than light in a vacuum.
|
| Microsoft bought a hollow optical fiber company for a reason.
| biomcgary wrote:
| Other than seemingly perverse incentives, is there a good reason
| not to quantize trading time?
| mikewarot wrote:
| I've argued in the past that we should have batch settlements
| every 30 seconds, instead of in real time. We don't really need
| microsecond based skimming/front running.
| biomcgary wrote:
| 30 seconds seems reasonable. Don't the markets themselves
| make a fair amount of money off of providing fast access to
| the HFTs? Is that the primary perverse incentive?
| Loughla wrote:
| I've read the arguments that the microsecond trading serves a
| purpose that benefits all of us, but I fail to see how, even
| with the explanations.
|
| I'm with you. Every 30 seconds. Cap the power of connection
| speed in trading. Trading should be based on the value of the
| item being traded, not on how short the fiber run is.
| harry8 wrote:
| so now the race is to get the order in (or out) @
| 29.999999985 seconds or 15nS before the batch deadline.
| Interesting twist on the game. Unlikely to change who wins
| it, could it be worse for retail punters?
|
| We need to kill "front running" as a criticism of low-latency
| algo trding with fire. It's garbage.
|
| Front running is highly illegal and is where a broker knows a
| client is going to do a big trade due to inside information
| and trades on the account of others (themselves, typically)
| to exploit that inside information. It's a straight up cheat.
|
| Inferring from market data alone which way a price will move
| is legal, honest, been attempted since forever and absolutely
| fine. Also very, very difficult. Anyone who can do it makes
| the market more efficient, reduces the money available by
| doing it (which goes into investors pockets through tighter
| spreads) and really earns their money. You don't have to like
| them if you don't want to but it's worlds apart from front
| running using inside information.
|
| Where did algo trading profit come from? Won by being more
| competitive from brokers profit with a good chunk of that
| broker profit going to investors. Spreads are tighter.
|
| Where are the clients' yachts? Well tech did something about
| the some of the broker ripoffs earning their yachts - which
| puts money in your pocket.
| aeries wrote:
| You could randomize the batching deadline.
| harry8 wrote:
| and it won't help retail investors either.
| usefulcat wrote:
| If there are multiple orders at the same price on the same
| side, how should we determine which ones are filled first?
|
| Or put another way, how should we determine which orders are
| least likely to get filled?
| infecto wrote:
| Why not 1 minute then?
|
| You have ignored the whole issue of how are you then ordering
| those contracts in 30second batches?
| usefulcat wrote:
| If you're talking about something like having an auction (per
| security) every N seconds, I don't see how that addresses the
| underlying issue, which is how to determine order priority.
|
| If you have a bunch of orders at the same price on the same
| side, and an order comes in from the other side that crosses
| those orders (or there is an auction and there are orders on
| the other side which cross), how do you decide which of the
| resting orders at the same price should be filled first?
|
| The most common way is that the first order to arrive at the
| exchange at that price gets filled first, and for that reason
| being fast is inherently advantageous.
| ssivark wrote:
| [delayed]
| infecto wrote:
| There cases to be made that you get tighter spreads.
| spirobelv2 wrote:
| mev but for tradfi
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