News About <![CDATA[MTN INC OPPR TR GBP]]> News About en-us <![CDATA[The FBI and the SEC Are Cracking Down on People Just Like You]]> Some people will do anything to make money in the market.

Believe it or not, folks have even resorted to manipulating stocks to fatten their wallets.

And, crazy as this sounds, there are more people doing it than anyone imagined.

Now, I know you'd never do that. But the SEC isn't so sure. Neither is the FBI.

According to yesterday's Financial Times (the pink paper that some financial types read), the FBI is joining forces with the SEC in order to "tackle the potential threat of market manipulation... that [has] taken markets beyond the scope of traditional policing."

What's hilarious to me is that, before the FBI goes looking for market manipulators (like you) along with the SEC, it should be looking at the SEC!

But I digress...

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]]> <![CDATA[The Next Flash Crash Awaits: Why High-Speed Trading Is Still a Huge Threat]]> DailyFinance.com: In 2010, when the Dow Jones Industrial Average suddenly dropped 600 points and then just as quickly recovered -- the so-called "flash crash"-- high-frequency trading, or HFT, became the new economic bogeyman: hiding in a dark corner of financial ... Read more]]> <![CDATA[Why Market-Making Giants Want Knight Capital Group]]> KCG), which had to be rescued after it went belly-up in August following a $440 million loss later blamed on a "computer glitch," is expected to entertain takeover bids from interested parties this week.

Yesterday, high-frequency trading (HFT) giant Getco Securities, which already owns a 23.8% stake in Knight Capital, offered a combination of cash and shares valuing Knight at $3.50 per share, a 17.8% premium to Tuesday's close. Knight's share price rose 15% in trading yesterday in reaction to the bid, which was acknowledged by Knight management.

"I am convinced that this merger would unlock tremendous value for the shareholders of both firms while establishing a global leader in market-making and agency execution," Getco CEO Daniel Coleman said in the letter to Knight's board.

Another high-frequency trading firm, Virtu Financial Capital Markets LLC, reportedly plans to make an all-cash offer at $3.00 per share, according to FOX Business Network.

Wednesday's share-price rally was Knight Capital's biggest in nine years, as it could be about to be the focus on a bidding war between HFT firms.

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]]> <![CDATA[Unless We Act, High-Frequency Trading Will Crash the Markets]]>
That's because high-frequency trading, or HFT, doesn't add to market liquidity, stability or efficiency -- but it could cause a catastrophic market crash.

Here's what's wrong with allowing high-frequency trading, what HFT practitioners say they're doing that's good for the market (which is rubbish), what could happen based on what has already happened, and what to do to fix this black hole.

The problem is HFT is based on a lie.

High-frequency traders send out tens of millions, if not billions, of orders to exchanges that are never meant to be executed. They are fake orders designed to dump manipulative information onto the nation's exchanges.

And while other market participants are not actually forced to adjust their bids and offers or engage in any of these trades, allowing access to the exchanges to manipulate anybody in any way is something that ought to be outlawed.

Exploiting an Unfair Advantage

In the HFT world it's all about speed. Without it, HFT wouldn't be possible.

There's nothing wrong with employing external innovations that speed up computers or the time it takes for information to get from one server to another. But HFT takes it to an entirely different level.

As I write this, chains of fixed microwave towers are being erected to send market data and orders between New York and Chicago because electromagnetic radiation travels only 2/3 as fast in glass fibers as it does through the air. The towers were designed and are being built by a pair of HFT entrepreneurs who already have HFT customers lined up.

And as soon as this winter passes, Hibernia Atlantic's Project Express will be dropping a more direct new generation transmission cable across the Atlantic so data and trade executions can travel faster between New York and London.

The new cable will reduce the 30 milliseconds travel time it takes now by only a few milliseconds, but space has already been leased to the only takers, the HFT crowd.

It may be unfair that some players are able to pay for a speed advantage by employing new technologies, but it's certainly not illegal.

What should be illegal, and is an abomination, is that the SEC allows exchanges to serve high frequency traders by leasing them co-location space next to the exchange's servers.

Not everyone can afford that access. But because it can be bought, HFT players have a significant speed advantage over everybody else who expects the SEC and the nation's regulated exchanges to guarantee equal access to get data and place trades.

Trust Me, It's Not About Liquidity

The HFT crowd argues that they act as market-makers and add liquidity wherever they practice their trades and both markets and investors are better served by their activity.

That's absolute nonsense.

To continue reading, please click here...]]> <![CDATA[The Truth About High Frequency Trading and The Coming Market Crash]]>
But that's not true.

In fact, if you know exactly what high-frequency traders actually do and how they do it, you'll know what the SEC hasn't figured out, namely what caused the May 2010 Flash Crash.

You'll also realize that it's only a matter of time before these market manipulators cause a real catastrophic market crash.

Today I'll talk about what HFT players do and how they do it. And tomorrow I'll tell you how HFT could destroy our markets and economy.

What High-Frequency Traders Actually Do

High-frequency trading is fundamentally based on how market participants (for this discussion I'm talking about stock markets) place their orders to buy and sell shares and how HFT players act on those orders.

For every stock that's traded there is always (or at least it used to be "always") a "bid" and an "ask" price. Sometimes you'll hear the term "offer" or "offered" price, those terms are interchangeable with the term "ask" or "asking price."

The bid price is the price which someone is "bidding," or willing to pay to own shares. The ask price is the price which someone is willing to sell shares, or is "offering" or "asking" to sell at.

Bids and offers each come with the quantity of shares that the buyer or seller want to trade. There are millions of bids and offers made all day long, every trading day.

In fact, for every stock there are many bids and offers at several different prices.

The best bid, the highest price someone is willing to pay and how many shares they are willing to buy, and the best offered price, the lowest price at which someone is willing to sell their shares, constitutes a stock's current "quote."

In the U.S. we call that quote the NBBO, or national best bid and offer. But there are almost always other bids at lower prices and other offers at higher prices for all stocks.

High frequency traders employ pattern recognition algorithms that look deeply at bids and offers on stocks to determine if the movement on the bid quotes or offered quotes implies a directional tendency.

Computer-driven algorithms are "reading" the quotes, the intentions of buyers and sellers as they put down their orders in real-time, to make a trade that the HFT player expects to profit from if the directional bias their computers pick up is correct.

To continue reading, please click here... ]]> <![CDATA[When it Comes to the Facts and Figures, America is in Trouble]]>
That's true when it comes to trading (there's always a buyer and a seller). It's also true when it comes to politics.

But, just like in trading or investing, when it comes to politics, it's not about being "right" or "wrong." It's about distilling rhetoric and opinions down to facts and figures that can then (hopefully) be more objectively observed and used to fashion compromises that lead to winning positions, financially and socially.

I try to let the facts and figures speak for themselves and peel back others' opinions to get at what's really happening and why.

I change my opinions all the time, whenever there are new facts that warrant consideration. But in the end, I take a stance.

I'm telling you this because I'm about to lay out some insights and some indictments regarding the economy, Wall Street, and oil, and then delve into something that's so charged that some of you are going to flip out.

But before you do, remember, there are two sides to every story.

First up: poverty.

Just look at the numbers out this morning...

To continue reading, please click here...]]> <![CDATA[High Frequency Trading - Should We Slow Down?]]>
Learn to trade Emini Futures. CFRN "A Community of Believers Who Trade For A Living!"
]]> <![CDATA[What to Do When Every Market Is Ponzi Scheme]]>
What do the following have in common?...

The answer is that every single thing in that list is an example of market rigging, fraud, or both.

How are we supposed to make decisions in today's rigged and often fraudulent market environment?

Where should you put your money if you don't know where the risks lie? How does one control risk when control fraud runs rampant?

Unfortunately, there are no perfect answers to these questions.

Instead, the task is to recognize what sort of world we happen to live in today and adjust one's actions to the realities as they happen to be.

The purpose of this report is not to stir up resentment or anger -- although those are perfectly valid responses to the abuses we are forced to live with -- but to simply acknowledge the landscape as it is so that we can make informed decisions.

In this report I connect the dots on the fraud, noting both what we already know about and what we'd better prudently suspect is happening but not yet revealed. (If you'd like to jump straight to our conclusions about this Ponzi scheme click here.)

Swimming Naked

As Warren Buffet said, "It's only when the tide goes out that you learn who's been swimming naked."

What he meant was that poorly-run companies can appear healthy during boom times but are later exposed as hollow shells when the economic tide retreats. Naturally it's a lot easier to make money when times are booming, but much more difficult when the economic pie is stagnant or shrinking. The dot-com companies of the late 1990s are the poster children for this phenomenon.

My corollary to Buffet's naked swimming quote is this: It's only when the pie stops expanding that you find out who's been running a Ponzi scheme.

The global pie is no longer expanding, and the relentless parade of disquieting economic and financial news can be laid right upon that fact.

Sure, there are the prosecutable examples, such as Bernie Madoff, but state and municipal pensions and the Social Security entitlement program also fit the definition. So does the practice of expanding public debt at a faster pace than GDP, which many nations, provinces, and states have done for many years running.

These are all Ponzi schemes in the sense that they require constant growth to remain 'healthy' (or hidden, more accurately) and are therefore mathematically certain to fail. Now that the economic pie is no longer growing like it used to and most likely will not for decades to come (if ever), all of these schemes are rapidly falling apart.

To continue reading, please click here... ]]> <![CDATA[The Truth Behind the Tragedy of High-Frequency Trading]]>
It is, and I'm going to tell you who's behind it, what's really happening, when it started, where the sinkholes are, why they're there, how you can play in the short run, and how America can get back to investing in a successful long-term future.

The bad news is the problems infecting our capital markets are all systemic. The good news is that they can be eradicated one by one, if not all at once (which won't happen).

Today, we're going to look behind the curtain of high-frequency trading.

It's a nasty bug in the system and has long-term consequences, including the potential to kill the markets.

First of all, high-frequency trading isn't just what you think it is. It is much more than you know, and is in fact part of the fabric of the markets.

High-frequency trading (HFT) is known to be a game that specialized firms and trading desks play. Here's what most people think they know about high-frequency trading.

The HFT crowd uses super-fast computers to execute trades across different exchanges. There are 15 exchanges in the U.S. and more than forty "dark pools" (private trading venues that serve as de-facto exchanges) where shares can be traded.

Part of the problem is that there are so many trading venues trading the same stocks, but that's another story.

Here's what the high-frequency trading game is really about.

To continue reading, please click here....]]> <![CDATA[In Defense Of The High-Frequency Hackers]]> It's a potential "doomsday machine." It's "quite literally out of control." Hedge fund managers and Nobel winners say it should be banned. Others insist it should at least be regulated. Its practitioners are "parasites." Mark Cuban says they are "the ultimate hackers," who "scared the hell out of me." Last week they wiped out $440 million of Knight Capital's capital. Earlier this year they messed up Facebook's IPO. A couple of years ago they caused the Dow's 1,000-point flash crash. And everyone's horrified by that GIF making the rounds. Yes, it's the bête noire to end all bête noires; high-frequency trading. The only problem here is that I don't really see the problem.]]> <![CDATA[From Rogues to Riches: How ETFs Are Lining Wall Street's Pockets – While Picking Yours]]>
Maybe you didn't know that ETF trading accounts for 35% to 40% of all exchange volume, according to Morningstar Inc. (Nasdaq: MORN).

Maybe you didn't know that the U.S. Securities and Exchange Commission (SEC), the U.S. Commodity Futures Trading Commission (CFTC), the Financial Stability Board (FSB) and the Bank of England (BOE) are each concerned that ETFs pose potential systemic risks.

Maybe what you don't know can actually hurt you. (... and your finances. Go here to find out how to get some of the best wealth-building investment advice - worth more than $28,000 - for as little as $5 a month.)

Click here to continue reading...]]> <![CDATA[The Who, How, and Why Behind Silver Price Manipulation]]> No one knows the machinations of the day-to-day silver price better than Ted Butler.

Ted publishes bi-weekly commentary at www.butlerresearch.com, with a special focus on the silver market, which he's been closely following for over 30 years. Ted is an expert's expert.

So naturally, that's whom I turned to for an in-depth perspective on what's really going on with the silver price. As usual, Ted tells it like it is.

I think you'll be fascinated by Ted's tremendous insights...

Ted Butler on Silver Price Manipulation

Ted, you're widely recognized as the foremost expert on manipulation in the silver futures market. How do you define manipulation, and how are the main players benefiting from that?

Manipulation is another way of saying someone controls and dominates the market by means of an excessively large position. So, just by holding such a large concentrated position, the manipulation is largely explained. In real terms, whenever a single entity or a few entities come to dominate a market, all sorts of alarms should be sounded. This is at the heart of U.S. antitrust law. It is no different under commodity law.

Price manipulation is the most serious market crime possible under commodity law. In fact, there is a simple and effective and time-proven antidote to manipulation that has existed for almost a century, and that solution is speculative position limits. Currently, the Commodities Futures Trading Commission
(CFTC) is attempting to institute position limits in silver, but the big banks are fighting it tooth and nail.

As far as any benefits the manipulators may reap, it varies with each entity. But if you dominate and control a market by means of a large concentrated position, you can put the price wherever you desire at times, and that's exactly what the silver manipulators do regularly. This explains why we have such wicked sell-offs in silver; because the big shorts pull all sorts of dirty market tricks to send the price lower.

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]]> <![CDATA[CL-Crude Futures and High Frequency Trading]]>

Anything look unusual on this chart of Crude futures today? Pay attention to the timestamp on the chart... 9, 10, 11, 12, 13, 15, 16, 17 Uh, where's 14 (2 p.m.)? The chart goes right up to 14:04 then jumps to 14:21 then to 15:15 (2:04 p.m. EDT / 2:21 / 3:15) CME, where CL (Crude Futures) trade, went berserk apparently from an algo. They shut down the system, cancelled all open orders and
]]> <![CDATA[Thinking about high-frequency stock trading and transactions taxes on trades]]> <![CDATA[Bringing Global HFT Data Centers Up to Speed]]> <![CDATA[From Rogues to Riches: How ETFs are Lining Wall Street's Pockets – While Picking Yours]]> the rogue trader at UBS AG (NYSE: UBS) who lost $2.3 billion last week was trading exchange-traded funds (ETFs). Or that Jerome Kerviel, another rogue trader at Societe Generale SA (PINK ADR: SCGLY) who lost $7.2 billion in 2008, was trading ETFs.

Maybe you didn't know that ETF trading accounts for 35% to 40% of all exchange volume, according to Morningstar Inc. (Nasdaq: MORN).

Maybe you didn't know that the U.S. Securities and Exchange Commission (SEC), the U.S. Commodity Futures Trading Commission (CFTC), the Financial Stability Board (FSB) and the Bank of England (BOE) are each concerned that ETFs pose potential systemic risks.

Maybe what you don't know can actually hurt you.

ETFs: Growing Popularity, Growing Danger?

Just when you thought that exchange-traded funds were a simple, smart and safe way to diversify out of underperforming stock-and-bond mutual funds, along comes reality.

What these regulators and financial- stability oversight agencies are increasingly worried about is whether Wall Street's presumed good intention in creating these hugely popular investment vehicles is being undermined by unintended consequences.

But, let's not forget, we're talking about Wall Street, where unintended consequences are a rarity. The reality is that ETFs were originally conceived - and are increasingly being engineered - to ratchet up trading for the Street's own benefit.

And while you may not think that affects your investing or trading of ETFs, or your portfolio-diversification plans, you'll be surprised - and maybe even alarmed - to learn that you're wrong.

Let me explain ...

Instruments of Diversification ... Or Disaster?

ETFs started out as tradable alternatives to mutual funds. Initially, product portfolios consisted of stocks, or baskets of stocks, that replicated such key indexes as the Dow Jones Industrial Average, the Standard & Poor's 500, or the Nasdaq Composite Index.

The idea was to offer products that mirrored benchmarks - and that traded all day, like stocks. The tradability of these instruments offers effective liquidity that conventional mutual funds lack , with the added benefit that ETFs would also be easy to short.

Product offerings multiplied quickly. In addition to exchange-traded funds based on stocks, product sponsors created ETFs that replicated oil-and-gas, gold-and-silver and diversified-commodities portfolios - all of which were based on futures contracts.

A lot of ETFs started out as a cheaper alternative to futures trading. Futures traders must cover high initial-margin deposits. And positions are marked-to-market daily, which requires immediate additional margin coverage when losses arise. The upshot: f utures trading is too expensive and too volatile for investors who are used to traditional stock market investing.

Today, investors can find exchange-traded funds that offer exposure to all kinds of risk instruments - from currencies and bonds, to thin slices of the yield curve and volatility. And there are even "leveraged" and "inverse" ETFs that multiply risk exposure and allow traders to make all kinds of directional bets.

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]]> <![CDATA[This is what robotic, personification of High Frequency Trading (HFT) sounds like]]> ]]> <![CDATA[Quote Stuffing Nearly Crashes the NASDAQ]]>

What you need to know:Given today’s extraordinary market conditions, the UTP Securities Information Processor (SIP) processed more than 92.5 million quotations on the UTP Quotation Data FeedSM (UQDFSM) Channel 6 (NASDAQ-listed symbols S to Z) during normal market hours. As outlined in the UQDF data feed specifications, the UTP SIP has a message sequence number limitation of 99 million
]]> <![CDATA[LSE makes latest high-frequency move]]>
]]> <![CDATA[JNK Collapse]]>

You can read books or you can observe the market, I promise you if you observe the market, you will see patterns repeat time after time. Most of the volume in the market today is from High Frequency Trading and their set-ups are unmistakable, you can see them in just about every time frame and in just about every asset class. I always try to make it a point to investigate flash crashes and other
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