Serious HFT moved to shortwave years ago. The chicago-NYC routes by microwave still exist, but are only for things that need higher data rates (as measured in kbps). It's hard to hide a giant log-periodic or yagi-uda antenna. The sites near Chicago that are aimed at London are well known to those in the industry.



On Sun, Jun 21, 2020 at 10:53 AM Brett Frankenberger <rbf+nanog@panix.com> wrote:
On Sun, Jun 21, 2020 at 02:17:08PM -0300, Rubens Kuhl wrote:
> On Sat, Jun 20, 2020 at 5:05 PM Marshall Eubanks <marshall.eubanks@gmail.com>
> wrote:
>
> > This was also pitched as one of the killer-apps for the SpaceX
> > Starlink satellite array, particularly for cross-Atlantic and
> > cross-Pacific trading.
> >
> >
> > https://blogs.cfainstitute.org/marketintegrity/2019/06/25/fspacex-is-opening-up-the-next-frontier-for-hft/
> >
> > "Several commentators quickly caught onto the fact that an extremely
> > expensive network whose main selling point is long-distance,
> > low-latency coverage has a unique chance to fund its growth by
> > addressing the needs of a wealthy market that has a high willingness
> > to pay — high-frequency traders."
> >
> >
> This is a nice plot for a movie, but not how HFT is really done. It's so
> much easier to colocate on the same datacenter of the exchange and run
> algorithms from there; while those algorithms need humans to guide their
> strategy, the human thought process takes a couple of seconds anyways. So
> the real HFTs keep using the defined strategy while the human controller
> doesn't tell it otherwise.

For faster access to one exchange, yes, absolutely, colocate at the
exchange.  But there's more then one exchange.

As one example, many index futures trade in Chicago.  The stocks that
make up those indices mostly trade in New York.  There's money to be
made on the arbitrage, if your Chicago algorithms get faster
information from New York (and vice versa) than everyone else's
algorithms.

More expensive but shorter fiber routes have been build between NYC and
Chicago for this reason, as have a microwave paths (to get
speed-of-light in air rather than in glass).  There's competition to
have the microwave towers as close as possible to the data centers,
because the last mile is fiber so the longer your last mile, the less
valuable your network.

https://www.bloomberg.com/news/features/2019-03-08/the-gazillion-dollar-standoff-over-two-high-frequency-trading-towers

     -- Brett