onsdag 26 september 2012

Stock trading robots

Signs of an approaching technological singularity: Robotic trading systems.

A rapidly increasing amount of the trade on the exchange markets are now automated. There are people that make a living from short term investments (day traders), and they complain that it is harder and harder to read the signs. And so they can no longer make a profit.

To be able to make transactions at millisecond level, the computers need to be located in the same room as the "stock market computer" itself. As there are many stakeholders interested in this, they all want as short latency as possible. To make it fair, all such computers have the same connection with the same length of the cable.

This is yet another business taken over by computers. Is it good or bad?