The Rise of Machine Trading Monopoly and Front Running

Ken Griffin is surely a very rich man whose entity Citadel Securities controls 1/3 of US options trading volume and and 28% of US equities volume as of latest quarter. It made $3.8 billion revenue alone in the first half of 2020. Much of retail trading volumes are going through their entity and got the first “peek” by their trading system and then of course they could potentially front run these positions through either equities or options, all by leveraging their machine trading algorithms without much regulatory oversight. With its increasing market shares by the day, two issues become urgently important to be addressed. First the potential of Citadel becoming a monopoly and corner the market. Second the illegal practice of front running positions. It is quite amazing that this is done legally!

Article by zerohedge did a great job in explaining details. We as an industry should do something about this or we will all diminish pretty soon. The most hurt crowd is obviously retail investors/speculators and small hedge funds. 


The Impact of This Presidential Election

Tech stocks are hanging on a correction verge which also dragged down S&P 500 index. After a tremendous bull run of almost 60% from its March low, S&P gave up 8% from its most recent high and stays breakeven year to date. With the upcoming US Presidential election, market volatility is surely going to increase. If you are a long term investor, this may not matter to you. But take some money off the table may not be a bad idea given this volatility. Best yet, trading using Ailares' Intraday Alpha strategy may even provide pretty good returns with a zero beta and full liquidity overnight. Its flagship strategy has risen 12%+ YTD.

For folks who are interested in general knowledge of the impact coming out of Presidential elections, this article may be a quick and good read.