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Webinar: Telvent DTN / Nanex High Frequency Trading (HFT)
I just bought "Broken Markets: How High Frequency Trading and Predatory Practices on Wall Street are Destroying Investor Confidence and Your Portfolio" Kindle version on Amazon for $0.00! The webinar also referred to this book.
Not sure if this has anything to do with my own personal account but I was very surprised and delighted to get such a bargain. Maybe others could benefit? Maybe book is being supported to help sell it??
I don't think retail is the main target of HFTs. So, if they disappear, I don't think they'll be hurting.
I haven't listened to the whole webinar yet. Wish I had been around when it was live. Would of loved to confront them on a few things. While what Nanex is doing is interesting, some of their findings are a reach, imo. Got to hand it to them though. They really are doing a good job at creating free publicity for their products by fanning the flames.
I respectfully disagree. Unless you are talking internalization HFTs, the volume coming from retail traders is so small these days, that HFTs main source of income is coming from everything else. If retailers completely left, you may see internalization take a huge hit, but your average HFT firm won't be hurt.
I could be completely wrong of course. However, I think I read some data not too long ago about retail being such a small part of the overall volume. And when you consider HFT is probably doing at least 50% of the (equity) volume, it seems like HFTs are already trading off each other and institutional traders.
If you or anyone has figures handy of how much of the volume is composed of retailers, I'd be interested in seeing it since I cannot seem to find the source right now.
I've watched half of it. I'm still trying to find time to finish the rest. Do they (Nanex guys) specifically talk about how much is retail volume?
I asked a guy today at the office about the retail percentage. He told me that the last he heard, institutional traders made up 96% of the daily NYSE market volume. I'm trying to track down the paper I read recently about the equity market volume breakdown, but it had similar findings if I remember correctly. Considering that HFTs make up 50-65% of the daily volume alone, you can image institutional can be at least 30%. That doesn't leave much for retailers.
I work at a small HFT firm. The feeling around here has always been that if retailers suddenly stopped trading, it wouldn't affect us much. If at all. I guess it doesn't really matter. There will never be a lack of retailers. The ones that get fed up by market hijinx will be replaced by others that have dreams of striking it rich.
>HFT lives on retail primarily, based on my understanding, what I've read, and the answers I've received from those I've talked to.<
Respectfully, I'm with Lookoutbelow and others who do not believe HFTs are reliant on retail traders. Just a little thought on topic should tell you that it does not make sense and more likely sour grapes talk. Retailers can only be 10% at best, which equals a small amount to feed on.
But there must be plenty of mediocre traders working for institutions (as well as for HFT firms) who do no better than the average retailer, so they are the real source of good HFT firms food. Mediocre traders do dumb things just like other average human being traders. Good HFTs feed off human psychology traits so plenty to eat there within the professional side.
Any retail trader who is a little better than these mediocre types has an edge, so all is not lost.
For anyone interested in following the (negative) impact of HFTs on market, and for truly excellent premarket info every day (plus good refererence S&R levels on S&P and main stocks), go here:
I think a webinar with those two guys would balance the HFT arguments very well. Most valuable. Some videos showing dumb HFT algos at work here so don't naively think the HFTs rule. Some are responsible for breaking the current market with their incompetent and 'Wild West' unregulated programming.