Trading Bots Have Taken Over! 🤖

icedrum(70)

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#crypto

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Trading Bots have now taken over our stock markets and crypto exchanges. It is thought that 60% of all trades are now made by software on supercomputers... and that figure is growing daily!

Stock market traders pictured in the 1980's at the New York stock exchange

1989-1980s-new-york-stock-exchange-new-york-ny-trading-floor-cmrn3e.jpg

"Humans cannot compete on speed, it's as simple as that."

High frequency trading bots have revolutionised all of our financial markets, Bonds, Forex, securities and pensions and more are now being controlled by supercomputers around the world. Because trades can happen within milliseconds humans are almost powerless to compete! But this now makes the internet connection speed of the supercomputers traders financially crucial! Closer servers, straighter cables ... very avenue to get faster network communication speeds is being explored! Billions are being poured into the latest Microwave transmitters and receivers to facilitate faster communications and thereby potentially beat the competition every time.

Flash Crash

Our Bots can have bad days too it would appear! On a couple of notable occasions important stocks or resources have experienced price crash due to Bot error! It is sobering to realise that our financial system globally could stutter or crash, or boom, either because software glitch or some James Bond style villain with the latest greatest computer system! A serious yet not illegal technique that is employed by some bots is "Noise". Put simply, as all bots need to listen to all market data, if your bot puts out lots of false orders it cripples other bots speed as they have to interpret all this extra data. Your bot meanwhile can easily exclude the noise and trade faster than any one else - thereby winning every trade! Computerisation is of course inevitable, but great thought should be payed to each and every new detail as it presents itself. As AI plays a greater role in all our lives we need to make sure we know and trust those with their fingers (or tentacles?!) on the controls!