Wednesday, November 19, 2008
Blame IT for failures on Wall Street
Subprime didn't bring down Wall Street, but bad programming by IT did...
Did you know that a significant portion of all trades executed by Wall Street don't have human intervention and are submitted by computers? Did you know that you can write your own trading algorithms and put computers directly in the NYSE data center to avoid the latency of network hops to make your bad programs execute even faster?
Would we have had a subprime crisis if Wall Street banned algorithmic trading? The notion of Quants has the ability to take a bad situation and make it even worse. More importantly, many used quant strategies as a way to hedge their other bets but never considered that the logic behind the programs might be flawed...
| | View blog reactionsDid you know that a significant portion of all trades executed by Wall Street don't have human intervention and are submitted by computers? Did you know that you can write your own trading algorithms and put computers directly in the NYSE data center to avoid the latency of network hops to make your bad programs execute even faster?
Would we have had a subprime crisis if Wall Street banned algorithmic trading? The notion of Quants has the ability to take a bad situation and make it even worse. More importantly, many used quant strategies as a way to hedge their other bets but never considered that the logic behind the programs might be flawed...
