Dow jones plunges 1000 points or 10%

[Iron]

Indeed - the market gets what the market wants!

Jeff

"An investigation into the mysterious plunge found no single cause was to blame"

From the article Peter attached... what a big surprise!

I can't see how "circuit breakers" and prohibiting short selling (as in Germany, Greece and Portugal) is going to solve the problem. I can imagine a stock being put on hold for 10 minutes and everyone hit the sell button during that period.

I also find very amusing that stocks aren't suspended when they are soaring. I wonder why?

[CaerMyrddin]

I couldn't agree more

[Zenyatta]

I know that there are certain courses that return a negative (I dont know why, but they do). For example Wetherby, Musselwell (?) and Plumpton are courses I dont use. Conversely, Chester is my best course for my system. I never bet on Irish courses as they are negative too.



regards
Peter

Interesting. Chester has a strong front-runner bias, it has the smallest circuit in Britain. Because of the tight turns, front runners have the advantage. Wetherby and Plumpton have easy bends and favor back markers (horses coming from the rear).

[PeterLe]

I know that there are certain courses that return a negative (I dont know why, but they do). For example Wetherby, Musselwell (?) and Plumpton are courses I dont use. Conversely, Chester is my best course for my system. I never bet on Irish courses as they are negative too.



regards
Peter

Interesting. Chester has a strong front-runner bias, it has the smallest circuit in Britain. Because of the tight turns, front runners have the advantage. Wetherby and Plumpton have easy bends and favor back markers (horses coming from the rear).

Hi
Yes I'm sure it has something to do with that...I remember Scott Ferguson writing in one of his blog entries that he lays the field at certain courses??

regards
Peter

[CaerMyrddin]

Maybe the market will test this support in the near future?

It seems so, last friday...

[Bet Angel]

High frequency traders, high tech bandit or innovators?

http://news.bbc.co.uk/1/hi/business/10198133.stm

[LeTiss]

High frequency traders, high tech bandit or innovators?

http://news.bbc.co.uk/1/hi/business/10198133.stm

It's an interesting dilemma

With the World's economy being so fragile and vulnerable, it doesn't take long before a reasonable price fall becomes a crisis, quickly followed by investors & banks starting to panic

In principle, it's not a million miles removed from traders playing the exchanges.

In reality though, the World's markets are slightly more important than an individual horse race or tennis match

[Iron]

Bankers have become a popular target for politicians, but I hope they don't end up killing the goose that lays the golden eggs.

The financial services industry is a massive contributor to the Inland Revenue's coffers, and it's not like Britain has a massive manufacturing industry to fall back on!

Jeff

High frequency traders, high tech bandit or innovators?

http://news.bbc.co.uk/1/hi/business/10198133.stm

It's an interesting dilemma

With the World's economy being so fragile and vulnerable, it doesn't take long before a reasonable price fall becomes a crisis, quickly followed by investors & banks starting to panic

In principle, it's not a million miles removed from traders playing the exchanges.

In reality though, the World's markets are slightly more important than an individual horse race or tennis match

[Bet Angel]

Trading curbs cut in on new blip

http://www.businessweek.com/news/2010-0 ... ate3-.html

[Bet Angel]

SEC offers an explanation: -

http://www.bbc.co.uk/news/business-11456941

[Iron]

There was an interesting piece on High Frequency Trading on Newsnight earlier this week (http://www.bbc.co.uk/iplayer/episode/b0 ... 0_09_2010/ - it starts at 15:50).

With High Frequency Trading, computers place multiple trades per second. The trades make a very small profit relative to turnover, but the sheer number of trades means that a very high profit can be generated.

Are there programmes in use on Betfair which work on the same principle, ie placing and cancelling multiple trades per second without any human involvement, and coming up with a profit over a very large number of trades?

Jeff

SEC offers an explanation: -

http://www.bbc.co.uk/news/business-11456941

[Bet Angel]

Go back a fair few years and Betfair was a free for all. Automated tools smashed into Betfair and an arms race developed, who could refresh / place bets at the highest speed.

Ultimately this created a lot of stress on Betfair's servers, so having invested in capacity for some time they decided to start caching data on the servers. No matter how many times you called the site per second you would see the cached data and that is the model that has stuck ever since. Since the implementation of the cache there has been little point in trying to refresh at enourmous speed or gain an edge that way as you simply return old data.

That didn't stop people from still doing a very large number of transactions, so the transaction charge was introduced to make it unprofitable to exceed a set number per hour. Then we also have the data charges which restrict activity further.

Go back quite a few years ago and yes you would probably see very high frequency trading, but I suspect that is not the case now. Betfair have also worked out they can reduce their technology costs by imposing strict limits so that is unlikely to change, at least to a faster model.

[Iron]

Interesting, thanks.

Are there any such restrictions on Betdaq?

Jeff

That didn't stop people from still doing a very large number of transactions, so the transaction charge was introduced to make it unprofitable to exceed a set number per hour. Then we also have the data charges which restrict activity further.

[Bet Angel]

Betdaq do something similar but in a different way. Also they don't charge you if you exceed it, you just can't exceed the limit.

[Iron]

Do you think Betdaq may have scored an own goal, in that letting people employ High Frequency Trading could improve liquidity?

Even though there are limits to how many trades you can execute on Betfair, are there spreadsheets that can make profits consistently, in all types of markets? Or is this an area where man is still better than machine?

Jeff

Betdaq do something similar but in a different way. Also they don't charge you if you exceed it, you just can't exceed the limit.