christianhgross

>What about flash quotes and fractional quotes. I can not buy MSFT at 25.10001$ Of course you can. You just need the right broker. I use IB and in the US I can't buy fractional prices. However, in Europe I sure can. I can actually buy a stock at 25.0001. Kinda silly IMO, but hey it is what it is. I don't think that HFT is worth it. Sure you see the profit they make, the volume they drive, but there are huge costs as well. I used to work at an investment bank and I was in the same department as the HFT MM folks (my work was OTC). It sounds exciting to do HFT, but it is quite a bit of tedious menial work that is completely non-glamors.

I find this discussion interesting and one that is best said by UrmaBlum ""Success in the markets is not about instinct, divine inspiration or spontaneous intellectual combustion. It is about intelligent data processing, sound method and the management of risk and resource that is both effective and adaptive to change." HFT is a fact of life and trading - if you can't deal with it other than to blame it for your own weaknesses - then you are in the wrong game." I write algos, and am a computer geek. I personally find HFT equalizing. Before algos the stock market was reduced to a set of "men" like in the movie Floored. In fact I loved the movie for the one quote said by the trader, "before we were making fun of the nerds and now they own us". Yeah exactly! I remember how back then their attitude was, "suck it up pumpkin". Now I say to anybody who whines and cries that the market is destroyed, "suck it up pumpkin!" Do I sound angry? Partially I am, because to a degree I am laughing as the market is now a quants dream. I can live with that. Does it mean many will not make money? No, in fact not true at all. You just have to adapt and change. I don't write HFT's for myself because I don't have the desire to enter an arms race. But I do write algos that catch when HFT's and markets make "mistakes" and "mispricings".

I read your post and I get concerned... Here is why... Governments don't take it lightly when you just manage people's money without any regarding to regulations. I am taking my portfolio manager license for Canada exam because I want to make sure that the law or intent is on my side. For the most part the law does not care what you do. It cares when you do the following; advertise, and bugger up. IB has a friends and family account which means that for the most part for a few clients you can manage money and be within the confines of the law. Most countries will "close their eyes" and not go after you. The idea is that they want you to be able to start without having to do all of the paperwork. For example in the US I think you just have to take a simple exam, and registeration and you may manage money up a certain amount. When you get above a certain amount and IB will indicate that to you, then you need to get regulated. Then it is not optional and you better get your ducks in a row because if you screw up you are going to jail. One of the loopholes people use is off shore brokers. People think then you are not subject to the law since, well the brokerage is offshore. Fine, if you happen to be living offshore as well. BUT if you are in one country, and your client is in the same country then in the eyes of the law you are breaking the law. Look closely at the Stanford case for that. Thus if you and your client are in the US you are subject to United States law, no and's, if's or but's... Remember this, if you want to make this as a profession stay on the up and up, as you might be burning bridges down the road. And it is not that difficult to start... Just a bit of studying, and a bit of registration. That is IMO not too much to ask.