How to slow down a stock exchange

High-frequency traders have a few tactics on stock exchanges: but simply put, they gather price information faster than anyone else, sometimes even faster than the markets themselves, and use that to make a tiny profit many, many, many times. There are all sorts of solutions: but it turns out there's a simpler one that involves physics.

(you can find contact details and social links there too)

[TomScottGo]

Apologies for the patchy video quality in places here: my camera really did not like the lighting inside IEX's offices. And to be clear, this isn't sponsored, I just found out about the cable loops and emailed IEX to ask if I could film with them!

[p.f]

Just imagine having the balls to be the guy in the meeting who goes "we could just have a 61km cable in the server room".

[ceruchi]

I love this. It's totally nuts that in the 21st century the literal speed of light is the only obstacle to financial transactions.

[briancox]

Imagine the day that RFQ came in to the fiber provider. "You want what? 38 miles? Ok, where are we running from and where is it going? Its all in the same 4U rack mount?!"

[danc.]

Interestingly, I used to work at a radio observatory that did much the same thing. With an interferometry array (lots of radio telescopes in a line, often on tracks), for things to work, it's critically important that signals from all dishes reach the control room at the same time. Yet, some are physically further than others. So the solution is to just pass the signal through coils of cable in exactly the same way so the signals from closer telescopes are delayed more than those from further ones.

[richbuilds_com]

Alternatively, they could forward every trade through the British government - that should delay the process for oh... two years or so...

[Theorak]

0:42 Those Pigeons are a perfect analogy for what happens when a good deal shows up in high frequency trading. :D

[ComicDrake]

I love that the NYSE is advertising their freaking Pinterest.

[SaberusTerras]

I'll bet the industry's argument on the IEX speedbump was nothing more than companies hating the loss of advantage.

[Movie_Games]

I have no idea what's going on at any point in this video.

[Simn]

Not sure the NYSE and Pinterest share the same demographic tbh

[bartholomewdan]

"Slowing down a stock exchange with 38 miles of cable"
What a title.

[JonnyJKF]

Welcome back to this video fellow WAN Show viewers. Didn't even have to search for this, the algorithm pushed it to my homepage.

[regiondeltas]

Love this video - I work with latency sensitive software that operates over long distances, and I regularly have to try and explain to people that no matter what we do we're constrained by the speed of light at the very least.

[schmoyoho]

now can someone do this for Smash Bros so i stop getting my ass beat?

GREAT VIDEO, 10/10, i would tell you in person since you're in NY but i'm shy 👏👏👏

[iliatchaplinski]

The original reason they used "only physics" rather than software wasn't to make the system more reliable. It was because the software was owned by the Royal Bank of Canada. "Flash Boys", a book about the start of IEX, gives the story.

[Questionable_Content]

2019: Slowing down a stock exchange with 38 miles of cable.
2020: Slowing down a stock exchange with a bat

[TheLunaLockhart]

"why couldn't they just use copper wire" I thought to myself, forgetting what an inductive circuit is.

[adenijiayocharles]

I searched for this video after Linus and Luke mentioned it on the WAN show, could not see it but I opened Youtube today and boom, the algorithm provided it.

[cyborg_v]

Who would win?
Some of the richest and most powerful companies in the world spending Billions on speeding things up
Some Coily Bois