New Rules
Meet the makersThe silence -of wall street
The new age
Yes, Wall Stret isn't like we think. The big traders now take up an entire floor of a skyscraper. They are in rooms under 0°C where just a couple of technician can access it. These new traders are the algorithms. The most of all trades and equities are now done by algorithms and these algoritms reside inside servers that are connected together and they are located as close as possible to the exchanges so that they can access that information before anyone else. Nowadays the negotiation practice known as "open outcry" there is no more.
The machines conquered the world of financial markets and turn it into a world where the international exchanges are connected by undersea cables and μs's count. This is the world of the algorithms, a world in which if you are 5μs behind you're loser. So the algorithms are dependent on one quality above all else which is speed. They operate in nanoseconds which is sort of a little difficult for us to imagine, because we are humans and we operate up here. It's pretty cool, the speed of light takes 65 milliseconds to travel from london to New York and so a trade can be done on the NASDAQ exchange in 100μs also thanks to developing hardware-accelerated chips that will execute a trade in 740 nanosecods.
This is a world where the international exchanges are connected by undersea cables, a world where 300 million dollars is being spent to shave five milliseconds of time so the algorithms can be a little more competitive with each other. Here the speed of light is something they have to factor into the equations they make. That's the kind of world that these machines operate in.
So how can we race against these huge opponents, algorithms that we don't undestand, operating on timescale that we can't conceive? And how can an investor who hasn't got these technologies understand a market in which in the time you took to read this line, tradig robots computers traded more than a million stocks? A market where prices are thus subject to quick changes called "black swans" which happen at an unbelievable speed. For little investor and new shareholder attempt to understand this AI-driven market isn't such an easy undertaking.
What can we do to invest consciounsly and really undestanding what happens? We can adapt our resources to the new rules of the game. To do conscious and better investments we need to raise up our level of analysis with new technologies which can help us making better investment using the forecasts provided by them. So we reach a deeper level of understanding which can meaningful help us making better investments. To do this we made Apollo.