Monday, August 17, 2020

300 Algorithms

They say it takes about 300 algorithms to master the game of Chess.
It is not clear to me yet how many are required to master the stock market. But I feel that those traders who feel that they have an "edge" because they trade certain financial derivatives are being naive. 

Algorithms do not need "down time"  and do not require "screen time" reading tape or ladders. Their capacity supercedes anything that a human being or even a group of cooperating human beings could hope to accomplish even if they could be physically or at least mentally present "in" the market     24 hrs a day..... 7 days a week.

That is why, the stock market is fundamentally changing. The speed with which the movements take place are accelerated by the algos. Nothing slows them down, as they have no emotion or "perspective" outside of what has been programmed into them. They are not "super-human". 
They are anti-human and will stop at nothing to scrape profits from every single corner of the market...both the dark pools and the more transparent trades. They have been created to serve certain humans, .....not ALL humans....and certainly not ALL countries.

 I believe that  A.I. covers each and every transaction that occurs in the stock market. Trading is becoming a  war of the "artificially intelligent" algorithms. The edge will be had only by those who "possess" the smarter programmers.

Artificial intelligence is already "bigger than us". Their capacity to spontaneously combust the markets is already quite clear. But there do appear to be "stoppers" in the markets. How effective these stoppers will be over time remains to be seen. In certain markets, yes.. they appear to function. How long would it take the a.i. algos to outsmart these stoppers for financial exploitation? We are talking about world altering, country obstructing, war causing financial implosions.

Sorry, to be a tad negative, but it helps to put these ideas into words we can rest, reset, rethink and protect ourselves and the future of our society from what our own hands can create.
I understand better now why folks do not hold things long term in the markets any more. They simply can not trust that the "gatekeepers" will be able to hold back the market busting power that the a.i. algos  carry.

I hope I am wrong....and all is green meadows and lambs skipping across bubbling brooks. 

Peace out,