

Speed trading may be heading out to sea - anigbrowl
http://www.cnbc.com/id/42469449/

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bigiain
Errrmmm, sure - the "halfway point" for the data between New York and London
is "in the middle of the ocean", but floating above it in a boat isn't going
to give you access to the fibers down ion the ocean floor.

I call bullshit.

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gojomo
Radio.

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bigiain
Really? You've either gotta keep the carrier frequency down low enough to let
it bend around the earth - which limits the bandwidth you can transmit, accept
the vagaries of shortwave radio transmission - which doesn't seem to be what
you'd need for HFT applications, or lose the several hundred milliseconds it
takes to get to geo-sync orbit and back _twice_ - which would lose out speed
wise to anybody on the ground at either end who only needs to get his signal
up to orbit and back once.

I don't see how radio helps much?

(perhaps a string of line-of-sight high frequency repeating stations? At a
first approximation assuming 100m (330') tall towers you get ~36km to the
horizon, so you'd need ~150 towers with repeaters on them to cover the ~5500km
from London to New York. I guess that's not _impossible_, but even if you
could stack up the infrastructure required, the latency in those ~150
repeaters would need to be very small to beat the guy sending his data through
the fibre on the sea floor with a theoretical ~20ms ping time, and a quickly
googled practical pingtime of ~100ms. The radio options still requires the
~20ms speed-of-light propagation time, but needs to get the signal through
~150 repeaters as well, compared to just the one on each end of the fibers (I
_think_ the optical repeater/amps used on oceanic fibers are zero latency...)

~~~
gojomo
Good points.

AWACS – or analogous commercial aircraft regularly in convenient positions?

Or far fewer towers/tethered-transmission-balloons at much higher altitudes?

Or even unmanned constantly-flying communications platforms – 'SkyStation' was
one such blimp-based concept from the 90s.

Wikipedia suggests the actual service distance from an elevated antenna is a
bit larger than the simple geometric estimate. Also, I think you've doubled
the necessary number of 100m-high relays: if each tower reaches the horizon at
N kilometers, they reach another equivalently-elevated tower at 2N kilometers.

Seriously, though, if there was something to this, they could eventually
splice some optimally-positioned platforms into transatlantic cables (existing
or new). Of course then the 'optimal position' would then be more a function
of available cabling than of natural geometry/geography.

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fuzzmeister
"With multiple players engaging in high-speed trading - buying and selling
stocks at literally 90 percent the speed of light"

This sentence seems meaningless - it's comparing units of time to units of
velocity. My best guess is that it means trades are made in 90% of the time it
would take for the data to simply travel the distance between the exchange and
the server, but that is not at all clear.

~~~
maw
Duh, just read a few paragraphs up: "[funds] could soon be relocating ... to
defy the laws of physics". It's pretty obvious to anyone with half a brain
that if they can defy the laws of physics, selling stocks at 90% of the speed
of light is trivial. (Although once you get above 90% you start to run into
some limitations.)

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lwat
This needs to be stopped, seriously. I refuse to believe that HFT really adds
anything of value to the world.

~~~
kiba
Why do you think HFT does not add any value to the world?

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qq66
How would it? What positive externality is generated by HFT's winning and
losing money from each other?

Are you arguing that the market liquidity provided justifies the amount of
effort invested? Obviously it does in some purely capitalistic sense, but what
is really created by this activity.

~~~
kiba
So you are arguing extremely intense competition is useless.

From my point of view, market participants make a living by their ability to
execute OODA loops. The bot trading wars is a more extreme version of the
competitive process.

~~~
wladimir
Yes, extreme competition is useless.

A level of competition is good, because it makes people do their best. But as
soon as it becomes too cut-throat, resources are wasted on auxiliary things
beyond just being the best and most cost-effective.

These electronic trading boats would be an excellent example of "market
failure" in this regard.

Instead of actual trading boats to trade their food and stuff, we'll now sit
in the middle of the ocean to correlate some arbitrary signals... Like
excessive speculation in commodities, it doesn't add value.

Don't tell me "it adds liquidity" because I already know that. One could argue
we have massively enough liquidity already in the things that would actually
be arbitraged here.

The financial sector overall is much too big:
<http://www.voxeu.org/index.php?q=node/6328>

~~~
jam
"These electronic trading boats"

Wait... is this a joke?

