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Úlfhéðnar
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A british man was extradited to the US, tried and convicted for "spoofing" through a self developed trade program, which capitalized on the twitchy nature of large trading firms' high frequency trading software.

These firms' programs capitalize on their inhuman reaction time to trade shares and options in the gaps caused by human entered orders, but by their nature, are reactive, making money in the small swings caused by individuals' market orders. He wrote a program which would write and cancel orders at the same speed, causing false market swings as they attempted to capitalize on his trade, and making money by knowing how they would jump.

The result of this was him making 40 million dollars, and causing a 1 trillion dollar "flash crash" which lasted for an hour.

Instead of banning this form of trading process, which is inherently unfair to small players, the government just punishes those who manage to beat the system anyway.

https://www.bbc.com/news/explainers-51265169
 

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"TURGID FLUX"
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5,811 Posts
If the system were fair, trades would be controlled by a bulk delay so the HF trading and schemes to reduce trading transport delay time would be nullified.

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The entire system almost from the ground up is a shell game. The problem is it is one of the few ways the common person can save a substantial amount of money and not lose value due to inflation. So we are all taught to invest in it to save money for our retirement. And if we don't invest in it we are irresponsible. So we invest in it, hoping the shells will stay in motion long enough that we can draw our money out before it collapses. And because of that we have to believe in the system and continue to prop it up even though we know it is unsustainable.
 

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D. Gibbons is a bad man
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5,716 Posts
Zero sympathy for him as his orders were not intended to gauge market depth or liquidity. He is not the only individual or Corp that has been fined for this recently.

https://www.thetradenews.com/merrill-lynch-fined-25-million-multi-year-spoofing-scheme/


Not once have I ever felt any animosity towards HF but just more often than not pleased by the narrow bid / ask spread on stocks attracting elevated levels of HF trading.

He should have released the software publicly, free of charge the second he knew charges were coming.
Its a routine in C++ or C# not a magic beans kinda application.


The entire system almost from the ground up is a shell game. The problem is it is one of the few ways the common person can save a substantial amount of money and not lose value due to inflation. So we are all taught to invest in it to save money for our retirement. And if we don't invest in it we are irresponsible. So we invest in it, hoping the shells will stay in motion long enough that we can draw our money out before it collapses. And because of that we have to believe in the system and continue to prop it up even though we know it is unsustainable.
If your willing to put just a few hours a week into the markets it’s less of a shell game and a lot like growing vegetables.
 

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Zero sympathy for him as his orders were not intended to gauge market depth or liquidity. He is not the only individual or Corp that has been fined for this recently.

https://www.thetradenews.com/merrill-lynch-fined-25-million-multi-year-spoofing-scheme/


Not once have I ever felt any animosity towards HF but just more often than not pleased by the narrow bid / ask spread on stocks attracting elevated levels of HF trading.

Its a routine in C++ or C# not a magic beans kinda application.


If your willing to put just a few hours a week into the markets it’s less of a shell game and a lot like growing vegetables.

Maybe that is true but it is a rigged system. I am enticed by my employer to put money in some type of stocks. If I put in 4% of my earnings they will match it but in that case I have two choices, high returns and high risk or guarantee but very low returns. If I wanted to invest on my own it would be like taking a 4% pay cut a work because they would no longer match my investment.

From the federal reserve down our entire monetary system has been corrupted into a system that puts more money into the hands of those who already enough money to have influence in making new laws that funnel more money into their pockets.
 

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"TURGID FLUX"
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Dont put your money all in one basket. There ARE NO GUARANTEES.

I was in one of those employee match 401K plans around the market downturn in around 2000 - 2001, the options were very limited. I could only buy the few funds offered . One of them was supposedly low risk option called "capital preservation". Despite its name, it lost money and I could not even move the money into a cash option as there was none.

In my next job, working for a huge, now defunct consulting firm, I had a Merril Lynch account with similar limitations . The company went bankrupt in 2009 and when I tried to move my money into my own IRA I found it was frozen because 99% of the other employees were similarly in that fund. I did get my money, but it earned nothing for three months, I called the SEC and they said they could do nothing.

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