Nanex

“Quote Stuffing” and the Collective Intellect

~ This post is a continuation of Decay of Knowledge, Rise of Tech Debt ~ Unless you are among the short list of folks with detailed understanding at the crossroads of financial market microstructure and highly-automated trading, the term quote stuffing might not ring a bell. But, since the concept behind this loaded term is germane to the points I want to make here, it is worth taking a moment to wrap your head around the basics. The parallels between the kinds of shenanigans that go on inside financial market microstructure and the emerging study of the "attention economy" or an "attention market" are fascinating. First discovered by Nanex in 2010 (shortly after the Flash Crash), quote stuffing is an automated trading technique that is used to flood trading infrastructure - namely, "matching engines" and the surrounding connectivity - with quotes that are then quickly cancelled. The goal of this strategy is to spike data flows to a point that surpasses the bandwidth capacity of the target trading infrastructure. This [...]

By | 2018-03-14T21:58:31+00:00 March 13th, 2018|Alphacution Feed|