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‘Cover Story’ Algorithmic Trading Articles & Financial Insight

  • Swan Luck?Swan Luck?

    SUBSCRIBERS ONLYChaos theory dictates that when a butterfly flaps its wings in China, a volcano erupts in Iceland. Or something like that. Luckily, we have the technology to handle chaos. As every school-age maths prodigy knows, Complex Event Processing (CEP) technology has been evolving in recent years, just in time to handle today's alpha-rich array of post-crash complexities. It's that simple... or is it? Anita Hawser investigates.

  • Tech's message: Open up!Tech's message: Open up!

    SUBSCRIBERS ONLYIn the second of our series of conversations with key industry figures about ensuring the long-term survival of the enterprise, Daniel Riek, CTO, Vincorex, discusses the potential role of the open source community as a provider of future proofing through dialogue.

  • Tech's  messageTech's message

    SUBSCRIBERS ONLYIn the first of a new series of interviews in which key figures address the technology decisions we have to make - today - to ensure the long-term survival of our businesses, Carl Ververs, Head of Product Development at RTS Realtime Systems, talks to Automated Trader about today's challenges, tomorrow's solutions, the questionable goal of system-wide speed, and where to look for tried-and-tested answers to the hardest long-term tech questions.

  • Playing the fieldPlaying the field

    SUBSCRIBERS ONLYSorry. It’s MiFID again. Europe’s playing-field levellers are having another go. MiFID 1 made life on the markets rather too interesting, so here comes another attempt to achieve the European trading equivalent of living happily ever after – by order. We sent cub reporter David Dungay (who retained an inconvenient degree of youthful idealism) to face the Directive known as MiFID 2 and report back on its likely impact on European trading. David has returned, a sadder and wiser European Trading Correspondent, and this is what he has to say.

  • The threebie that isnítThe threebie that isnít

    SUBSCRIBERS ONLYThere’s a Rule of Three in dark-pools. One of the three types of counterparty match you meet there could cost you money. But which? Many dark pools and electronic liquidity providers now provide a matching service that allows users to potentially trade at a price that is equal to or better than the price on the primary exchange or corresponding MTF. Whilst this service seems instantly appealing, end users do not always question why somebody would be the counterparty to this trade. Dr Paul Lynch, CEO of Switzerland-based PE Lynch Global AG, takes a look at the desire to meet in the middle and why ending up on the end of the wrong type of mid price match could be to your disadvantage.

  • There goes the neighbourhoodThere goes the neighbourhood

    FREE ARTICLEIt’s open season on hedge-fund managers and high-frequency traders in Europe and the USA. Legislators on both sides of the pond are voting on new rules to redefine the traditional relationship between risk and reward – expect a legalese version of: don’t take the risks because we’re going to deny you the rewards. Much of this is necessary work – after all, we don’t want those naughty defaulting mid-western mortgage holders bringing down the financial system again, do we? But some of it looks more like political grandstanding than enlightened policy-making, and some of it seems downright unhelpful. Automated Trader’s Editor, William Essex, considers the possible unintended consequences of the current transatlantic regulation-fest, and wonders whether we might all be better turning up for work – somewhere else.

  • The show must go on!The show must go on!

    FREE ARTICLEIt was fun, actually, Trade Tech this year. More volcanic eruptions than usual, and perhaps fewer people than Paris 2009 – although the official count made it “the largest gathering of equities professionals in the ten-year history of TradeTech”. But a lot of connections were made, follow-up meetings arranged, and key issues addressed, both in the formal sessions and on the exhibition floor. Latency was the biggest issue discussed but not the only one: when we weren’t talking about those last few micro-seconds, we were discussing: effective data delivery and usage; smart- and smarter-order routing; best execution; market surveillance; post-trade economics; clearing – and whether we had enough room in the magazine for all those launches. Automated Trader’s Editor, William Essex, reviews the show that so nearly didn’t happen.

  • You want alpha with that?You want alpha with that?

    SUBSCRIBERS ONLYAnd do you want your order well done, or scrambled? Helen Sanders serves up the latest in adaptive routing technology.

  • Give us an A!Give us an A!

    SUBSCRIBERS ONLYScribes and soothsayers have been analysing trades since the first cargo of spices was unloaded from the first camel train. But would their work have been any easier if they’d had laptops? William Essex looks for simplicity in the evolving complexity of pre-, post-, and above all during-trade analysis.

  • Perfect Partners?Perfect Partners?

    SUBSCRIBERS ONLYDo partnerships add value? Really? Are you sure? How much value? As the Automated Trader editorial inboxes clog up with more and more news releases about exciting new partnerships, William Essex wonders, is this really the most effective use of time and resources?

  • The Shock of the NewsThe Shock of the News

    SUBSCRIBERS ONLYMachines can read the news now, but can they be trusted to act on it? There’s been a lot of talk about machine-readable news since our Q1 2008 feature*, but does that go any further than adding bells, whistles and meta-tags to the text streaming across the bottom of the screen? Spurred on by recent events, William Essex has returned to the search for a genuinely machine-usable news solution.

  • Machine versus Man versus Machine?

    SUBSCRIBERS ONLYWhat’s the sense in trading the traders? William Essex closes our discussion of commodities with a look at the changing behaviour of the markets themselves. Might the “electronic effect”, and within that a distinct “algo effect”, itself become a factor in a commodity-trading strategy?

  • Volatile but fundamentally floored?

    SUBSCRIBERS ONLYWe continue our coverage of commodities with one man’s analysis of the long-term case for investment. David Nahmanovici delivered his analysis at IDX in London, back in June. We were in the audience.

  • Commodities on the menuCommodities on the menu

    SUBSCRIBERS ONLY Hard and soft, edible and not-so-edible commodities have been a hot topic recently. But what substance is there behind the sizzle? Automated Trader has been looking into the current commodity boom, and asking, are these markets ripe for automation, and if so, what are their trading characteristics and their long-term potential for automated alpha generation? In the first of our series of linked articles on this theme, Dr. Robert Brady, CTO of Brady PLC analyses the current use and likely future evolution of automated trading in commodities markets. This is, as Dr. Brady observes, a whole asset class in transition. Some of its trading practices are arcane, but some put it right up on the screen alongside already heavily auto-traded markets such as FX and stock indices. Shouldn’t you be getting a feed on commodities?

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