It might be complicated. I am just saying it is probably not as complicated as a permanent transatlantic aerial drone network or owning your own particle accelerator. I think all the anti-replay, anti-backdating concerns have probably been solved in the various public/private key networks, if not, there are certainly ways to do so. My only point was to say that there are technical ways to make high freq trading more inherently fair and there does not need to be a connectivity "arms race" unless that is what the markets want to do. The markets created this monster, they can't really complain about something they have the power to eliminate any time they want. If the majority of traders feel they are getting screwed, the policies will change. Looking at this from a strictly engineer's point of view, it seems like a very, very, risky way to handle extremely large sums of money. The systems are already outpacing the speeds they can be controlled and managed. At some point the systemic risk to the entire system will be the regulating factor. Let's hope they can head it off before it happens. I can very well see a point where a major system meltdown will cause an entire day of trading to be unwound because there is no other choice. You could always require all the trading systems to be in a single place but there will always be backend systems to control and monitor them somewhere else. Hey, putting everyone in the same place is how markets worked before when you needed a guy standing on the floor in order to operate. Steve -----Original Message----- From: Michael Loftis [mailto:mloftis@wgops.com] Sent: Wednesday, August 08, 2012 9:56 AM To: nanog@nanog.org Subject: Re: raging bulls On Wed, Aug 8, 2012 at 8:08 AM, Brett Frankenberger <rbf+nanog@panix.com> wrote:
Even if you execute the trades based on a GPS timestamp (I'm ignoring all the logistics of preventing cheating here), it doesn't matter, because the computer that got the information first will make the trading decision first.
-- Brett
Such a system would be pretty complicated because it would also have to prevent intentional 'backdating' of trades as well. Then you've got the market data itself (as just mentioned) -- getting the information first is a big part of the latency problem for the quants. -- "Genius might be described as a supreme capacity for getting its possessors into trouble of all kinds." -- Samuel Butler