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We have to trade faster!
Solarflare Communications is an unheralded soldier in the eternal war on latency. With its founding in 2001, Solarflare took on the daunting raison d'être of grinding down latency from one product generation to the next for the most latency-sensitive use cases, such as high frequency trading. Today, the company has more than 1,400 customers using its networking I/O software and hardware to cut the time between decision and action. In high frequency trading, the latency gold standard is 200 nanoseconds. If you're an equity trader using a Bloomberg Terminal or Thomson Reuters Eikon, latency of more than 200 nanoseconds is considered to be shockingly pedestrian, putting you at risk of buying or selling a stock at a higher or lower price than the one you saw quoted. Now, with its announcement of TCPDirect, Solarflare said it has cut latency by 10X, to 20-30 nanoseconds.
[...] The CTO of an equity trading firm, who agreed to talk with HPCwire's sister [publication] EnterpriseTech anonymously, said his company has been a Solarflare customer for four years and that its IT department has validated Solarflare's claims for TCPDirect of 20-30 nanoseconds latency. He regards Solarflare as a partner that allows his firm to focus on core competencies, rather than devoting in-house time and resources to lowering latency. "It used to be the case that there weren't a lot of commercial, off-the-shelf products applicable to this space," he said. "If one of our competitors wanted to do something like this for competitive advantage, Solarflare can do it better, faster, cheaper, so they're basically disincentivized from doing so. In a sense this is leveling the playing field in our industry, and we like that because we want to do what we're good at, rather than spending our time working on hardware. We're pleased when external vendors provide state-of-the-art technology that we can leverage."
(Score: 2) by Zz9zZ on Wednesday January 25 2017, @10:43PM
I won't argue your priority, but I do argue the concept of letting some financial firms make a business out of fleecing investors by using fancy hardware to work the margins. Governments tax for a purpose, and the money generally goes back into the economy in some form. HFT seems to be taxing every transaction, it is like a casino where the house can play the odds. Nothing of value is created except for vague promises of liquidity and market making. I cry bullshit, and point to the insane amount of money invested in HFT infrastructure as the evidence. If there weren't piles of money to be made then HFT wouldn't exist, and those piles of money come from other investors. The profits that get sucked out don't go back into the economy, they simply pad some very large bank accounts... Money out, vague promises of "market benefits" in.
~Tilting at windmills~
(Score: 1) by khallow on Wednesday January 25 2017, @11:09PM
but I do argue the concept of letting some financial firms make a business out of fleecing investors by using fancy hardware to work the margins.
Why exactly do fleeceable investors, gambling irrationally in ways that HFT can exploit, deserve to keep their money? The current situation where they give their money to more competent traders seems better for all concerned. The "investor" loses the money that they are insistent on losing and someone with some really cool tech ideas gets it.
Nothing of value is created except for vague promises of liquidity and market making.
Which, let us note, is good enough. You have yet to show that HFT is harming you in any way.
(Score: 2) by Zz9zZ on Thursday January 26 2017, @12:06AM
The problem is that you think
Why exactly do fleeceable investors, gambling irrationally in ways that HFT can exploit, deserve to keep their money?
is ok.
The whole premise of the stock market is to make it easier for businesses to get investors. That is the gamble, choosing a good company to invest in. However, finance people quickly realized they can play shell games with stocks and fleece people out of their money. This creates a whole new "market" that is basically just gambling, except that these new investment firms can manipulate markets to various degrees to make some stocks look better or worse. It stopped being about investing in business and it is now about playing the margins to take people's money. It is 100% off the rails, and with increasing amounts of people's money in the stock market with 401ks etc. I dare say it should be illegal. HFT is harmful because it is another layer of scamming people, reacting to market information faster than humanly possible.
If you can't comprehend why gambling with the stock market is bad, then I don't know what to tell you. HFT is simply another layer. Anyone who takes money out of the stock market that isn't stock dividends is a thief. The money doesn't go to "really cool tech ideas" at all, so you are operating on seriously flawed premises.
After the IPO, stocks do nothing for the business itself.
The original company that issues the stock does not participate in any profits or losses resulting from these transactions, because this company has no vested monetary interest.
The stock market is legalized gambling, and a hell of a lot of money flows out of it and into private accounts. There is no real-world benefit, simply shuffling wealth around in what amounts to an imaginary game.
But hey, you're personally invested in the pyramid scheme of corporate capitalism as well, so keep reaching for the stars khallow and maybe one day you can be the boot stomping on the little people. More tax loopholes! More crazy tech to outmaneuver regular traders, MOAR MONIES! It is a sick game that doesn't have real world value, it just steadily shuffles wealth into individual pockets. It seems to take a market crash for people to wake up, but that only lasts a few days. Retirement accounts? Pffft, losers shoulda known how to invest better.
~Tilting at windmills~
(Score: 1) by khallow on Thursday January 26 2017, @04:31AM
However, finance people quickly realized they can play shell games with stocks and fleece people out of their money.
They sure can. But that's not HFT. That's fraud and it can happen at any time scale.
There is no real-world benefit, simply shuffling wealth around in what amounts to an imaginary game.
To you. Clearly it is a benefit to other people.
so keep reaching for the stars khallow and maybe one day you can be the boot stomping on the little people. More tax loopholes! More crazy tech to outmaneuver regular traders, MOAR MONIES!
HFT is not directed at regular traders. It's directed at high volume and high frequency traders.
It is a sick game that doesn't have real world value, it just steadily shuffles wealth into individual pockets.
It does have real world value to the people who engage in it. I don't see why your opinion of its value should trump theirs.
Retirement accounts? Pffft, losers shoulda known how to invest better.
Why is your retirement account in HFT? There's two related problems here that you are completely glossing over. First, the pension fund managers should not be able to engage in HFT. It's way too risky. Second, where's the concern of the pensioners? They should be getting involved now, not when their fund has gone bankrupt.