Tue, May 31, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

The Flash Boys flash mob

Friday, April 11, 2014

Bailey McCann, Opalesque New York:

Michael Lewis' new book Flash Boys released last week to great fanfare, and some very real investigations into market activity. In the book, Lewis blends two of his familiar plot lines wall street and plucky idealism. Lewis, former creature of the trading floor returns anew to find the state of play altered by computers and the young traders who run them, and he doesn't like what he sees. This time, the can-do idealist who beats the establishment is a former RBC trader who starts his own exchange after discovering the evils of high frequency traders. The book is not quite Moneyball or Liar's Poker, but it has sparked some new investigations into market structure.

Whether you like or hate high frequency traders, or believe they provide liquidity, the resulting Flash Boys flash mob investigations should probably trouble you. For starters, high frequency trading isn't all that new, nor is it new to regulators. What is new is the opportunity to scapegoat new parts of the market, thanks to the cover afforded by Lewis' book.

The game is rigged, maybe not in the over simplified David v. Goliath way explained in Flash Boys but front-running exists, QE exists, artificial scarcity exists, and pretending it doesn't to keep more greater fools in the game is only a short-term strategy. Watching hedge funds unwind the most fa......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Investing - Scientist turned hedge fund founder cuts profitable Aussie short, Pelargos joins hedge funds’ bet on turnaround at Honda, Managers set to cash in on infrastructure debt upswing[more]

    Scientist turned hedge fund founder cuts profitable Aussie short From Bloomberg.com: AE Capital, a hedge fund run by a former atmospheric scientist, trimmed bets against the Australian dollar as it gauges shifts in the world’s two biggest economies. The Australian, Canadian and New Zeala

  2. He's lost £200m in a year - so has Britain's star hedge fund boss Crispin Odey lost his golden touch?[more]

    From Thisismoney.co.uk: ...Odey’s laid-back attitude gave no indication of the turmoil his flagship fund had put investors through. It had tumbled 20 per cent in May – a terrible performance given most of his rivals were in positive territory for the year. Odey’s fund had got into trouble after taki

  3. Comment - If you’re such a great investor, where’s your alpha?[more]

    From Mineweb.com: … They are few and far between. You likely know their names. There is a short list of those who have 1) outperformed; 2) over long periods of time, and; 3) manage substantial sums of money. It’s impressive if you are on that list, but discouraging if you seek to invest institutiona

  4. European fund managers 'dressing up’ track record to gloss on performance[more]

    Komfie Manalo, Opalesque Asia: A new study by global analytics firm Cerulli Associates has found that the problem of 'dressing up' track records by fund managers is getting worse. In its latest issue of The Cerulli Edge - Europe Edition,

  5. Why the equity short bias hedge fund underperformed in April[more]

    From Marketrealist.com: The Barclay Equity Short Bias Hedge Fund returned -0.83% in April 2016. However, on a year-to-date basis, the fund provided a return of 3.4% through April 30, 2016. The equity short bias strategy works best when the Market is in a downturn. From January 2016 to mid-Febr