Nerds on Wall Street: Math, Machines, and Wired Markets

3.15. Algorithms at the Edge

Algos are pushed in all directions that will improve their performance. The minute-to-minute market games people used to play are now millisecond-to-millisecond games for computers, soon to be microsecond-to-microsecond. If you want the impress the fast algo crowd, mention femtoseconds. Light travels about one ten-thousandth of an inch in one of those. Even the fastest algo traders will never have to worry about them.

Mathematical models will become more complex. Markets will proliferate and become even more complex, rapidly. Adaptive probing strategies will adapt and probe complex markets. Quantitative information expressed as numbers will be combined with qualitative information expressed as text. Latencies will go to zero, and information will go to the sky.

Get used to it.