Automated and algorithmic trading technology beats human traders every time, doesn't it? Not necessarily. Participating in a trading experiment run by Professor Dave Cliff of the Department of Computer Science at the University of Bristol, Automated Trader CEO John Howard finds that the robots can sometimes be beaten by a human trader with a bad attitude. The trick - for the human trader - is to win by not wanting to win. Irrational? That's humans for you.
This is not necessarily a new conclusion, but there is a vulnerability in an "over-rational" trading environment that leaves it potentially open to a form of malicious gaming. Professor Cliff's experiment is the first of a series designed to examine the contemporary trading experience and thereby potentially identify flaws in our current methodologies. Readers are invited to contribute their views, and indeed to participate in future experiments.