Quantitative Trading (II)

Posted in Blog at 12:45 pm

In the middle of a spirited online debate on the pros and cons of High-Frequency Trading, and whether those traders working exclusively from mathematical algorithms were aiding the cause of price discovery or causing causing unnecessary fear in markets, someone asked: "so why the excessive volatility[?]"  I could not resist responding.  The following is an expanded version of my comments: We have excessive volatility because it is the interest of trading firms to encourage it, that's why. And Read more [...]


Against Quantitative Trading

Posted in Blog at 5:24 pm

I wrote this in response to a thread on LinkedIn, on which Mark Rome raised the question, “Is it Time for a Market That Prohibits High-Frequency Trading?”  regarding ETFs and all sorts of quantitative techniques, as well as HFT itself, on 5 November 2011: I'm afraid that most of this discussion loses sight of the real issues. Liquidity is not an end in itself. Cheap execution is not an end in itself. And I'm afraid that huge bonuses are not the goal of capital markets, either, although Read more [...]