Discussion of high-frequency trading on MT5 - page 59
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A few years ago, I might even have subscribed to these words. But surprisingly life has shown that even in such an ultra-liquid and seemingly super-efficient FOREX market, there are even inefficiencies unthinkable for modern exchanges. The only question is whether there is an infrastructure, which will allow to trade these inefficiencies.
A long time ago I knew a Moscow bank, where they traded stupid arbitrage between EBS and Barclays (there were other platforms too) mostly on strong news, like Non-Farm Payrolls. It was not super profitable, but almost risk-free. It was the bank's infrastructure. It was dumb, but still available only to the bank's algorithmic department.
Now there is a very powerful infrastructure that is much stronger in terms of organisation and technology than that bank, in particular. This is the result of a huge amount of work, which does not stop, because there is something to develop. It is not specifically aimed at retail traders. It just so happens that the retail trader is one of the first to be able to benefit from this work for free. Everyone can choose whether or not to use this opportunity. Darkpool itself is neither warm nor cold.
The question here is traditional: if a strategy (in this case a powerful infrastructure) makes money, why sell it or make it public.
Darkpool brings in money through turnover. Whether they sell technology or not, I don't know, you have to ask them. But personally, I see no logical reason to prevent them from selling something like this. Currenex and Integral sell their technology and that's fine. Moreover, the more widespread the technology, the easier it is to create on its basis a centralized section of the FOREX market. I.e. it is profitable from all sides, both for technologic providers, and for traders and liquidity providers with brokers.
I think the developers dream that professional traders, especially HFTs, will come to them and use their infrastructure for their high-turnover strategies. It is precisely for such potential clients that it is being built, in particular.
Of course, the most obvious ways of earning, if the creators have an algorithmic trading department, they will implement for themselves on the same terms as for others (no tech insider). But the only way they will earn money is not from commissions (it makes no sense to pay yourself), but from the profits of the TS used. And, as we know, the lower the commission, the more inefficiencies we can use to profit.
the question here is traditional: if a strategy (in this case, a powerful infrastructure) makes money, why sell or publicise it.
I think the cream of the infrastructure creators themselves pick up, but only what they can pick up to the best of their ability, some of it goes anyway.
The clients of the DCs can pick up that part if they recognise it.
hrenfx seems to want to say that the kitchens are evolving under the pressure of competition and new technologies and now VC clients can use algorithms that only large hedge funds and banks could afford before.
I think the cream of the infrastructure creators themselves take away, but only what they can take away to the best of their ability, some of it goes anyway.
Of course, it is unrealistic to take all the cream. But it is logical to take what you can, on equal terms. Transparency of conditions for all (including creators) is a strategic competitive advantage. If you create an artificial insider, someone potentially stronger simply won't trade. And he could make more profit on turnover than the creators themselves with TS on artificial tech inside.
hrenfx seems to want to convey that the kitchens are evolving under the pressure of competition and new technologies and now clients of brokerage companies can use algorithms that only large hedge funds and banks could afford before.
Darkpool brings in money through turnover. Whether they sell technology or not, I don't know, you have to ask them. But personally, I see no logical reason to prevent them from selling something like this. Currenex and Integral sell their technology and that's fine. Moreover, the more widespread the technology, the easier it is to create on its basis a centralized section of the FOREX market. I.e. it is profitable from all sides, both technolodging providers, and traders and liquidity providers with brokers.
I think the developers are dreaming of professional traders, especially HFTs, coming to them and using their infrastructure for their high-turnover strategies. It is precisely for such potential clients that it is being built, in particular.
Of course, the most obvious ways of earning, if the creators have an algorithmic trading department, they will implement for themselves on the same terms as for others (no tech insider). But the only way they will earn money is not from commissions (it makes no sense to pay yourself), but from the profits of the TS used. And, as we know, the lower the commission, the more inefficiencies can be used to profit.
You should understand that you are probably new here, and you probably know forex at the buy sell level, because you realised that if you see even a hint of MT4 on the website, you know it's all at the level of shawarma.
I don't know why, you should understand yourself. For the truth here they ban you and basically nothing personal, only business ) so no offence to admins )
Did you read the question?
How long have I been on FX and what's my level of knowledge ... that's question 10.
hrenfx gave a link to a source, called it the best in the field. With which I AGREE. You ...in your usual manner of laughing, so I asked for a link to a source that you think is more informative on FX. I would be happy to read it.
I think the cream of the infrastructure creators themselves take away, but only what they can take away to the best of their ability, some of it goes anyway.
Of course, it is unrealistic to take all the cream. But it is logical to take what you can, on equal terms. Transparency of conditions for all (including creators) is a strategic competitive advantage. If you create an artificial insider, someone potentially stronger simply won't trade. And he could make more profit on turnover than the creators themselves with TS on artificial tech inside.
Maybe hrenfx wants to show that kitchens are evolving under the pressure of competition and new technologies and now CA clients can use algorithms that only large hedge funds and banks could afford before.
Gunya and Dick are speculating about the future ... Has anyone got any popcorn left? :)
By the way, what are these algorithms that I can't use as a private person?
I think the cream of the infrastructure creators themselves pick up, but only what they can pick up to the best of their ability, some of it goes anyway.
The clients of the DCs can pick up that part if they recognise it.
It seems so, yes. Plus, it's not clear who controls the infrastructure.
hrenfx seems to want to make it clear that the kitchens are evolving under the pressure of competition and new technologies and now VC clients can use algorithms that only large hedge funds and banks could afford before.
i do not believe in free breakfast for all. life has taught me. so if something has gone to the masses, it means that the bigboys have or will soon have cool new toys.
it looks that way, yes. plus, it's not clear who controls this infrastructure. if it's like everything in forex - there's no point in trading for something else.
i do not believe in free breakfast for all. life has taught me. so if something has gone to the masses, it means that bigboys have or will soon have cool new toys.
In my humble opinion, such neo-DCs need high-turnover algotraders, not only because of the commission.This may be a quite reasonable way of headhunting in this sphere. Although it is only a guess.
P.S. This refers to the 1% if not less. So, about the free breakfasts you're absolutely right, the point hasn't changed. They allow you to earn up to a certain limit for a minority, for example up to 10K$ a month, and then offer you a collaboration, "an offer you can't refuse". And thus increasing the collection of cream for themselves and for you, at the expense of your talent. And in my opinion it's very logical and "right", if I may say so.
In my humble opinion, such neo-DCs need high-turnover algotraders, not only because of the commission.This may be a quite reasonable way of headhunting in this sphere. Although this is just a guess.
I think the conjecture is not without logic. which does not rule out simply recruiting meat under the flags of new technologies and fantastic opportunities.
PS. neo-DC - well said, by the way.