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Monthly Archives: February 2012

Speed Trading Expands Growth for ICE

If the securities market were a dysfunctional family, high-frequency trading would be its evil genius’ cousin.

Company valuations are giving way to computational probabilities.  The scope of investing in corporate stocks- from possessing research savvy to having investment skills – is being reduced to statistical un-biases, void of basing any decision on human emotion and God-given intuition.  Investment gurus are being replaced by mathematical wizards.

These are the sentiments of those whom oppose the trading mechanism and it is not hard to see why this is so.  Media’s portrayal of the world of high frequency trading — with words like “secretive” and “shadowy”– leaves it to be shrouded in mystery but because of the unknown factors involved it therefore becomes controversial.

Since the phenomenon of high-frequency trading (HFT) began to take off a few years ago only a handful of financial firms were involved in the practice at the time.  Today these same firms account for 70% of all the trading volume done in the US marketplace.  The once iconic imagery of brokers trading on Wall Street is being substituted for super-computer hubs capable of exchanging deals in nanoseconds. (more…)

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Fixed-Income ETFs Rally Despite Europe’s Pending Recession

It was recently announced by the World Bank, and backed by the International Monetary Fund, that the looming recession facing European nations would slow global economic growth, according to the Associated Press.

“In its annual report, the bank substantially cut its forecasts for growth in both developed and poorer nations. It now projects that the global economy will expand 2.5 percent this year and 3.1 percent in 2013. That’s down from a June forecast of 3.6 percent growth for both years.”

The IMF confirmed this projection by releasing its own forecast Tuesday of “global growth of 3.25 percent this year, slower than the 4 percent pace it projected in September. The 17 nations that share the euro will shrink 0.5 percent this year.   In September, the IMF had predicted 1.1 percent growth for the region,” both reports taken from NPR. (more…)