Interesting article on “quants” in trading.
“Linked with high-frequency trading is the developing science of event processing, in which the computer reads, interprets, and acts upon the news. A trade in response to an FDA announcement, for example, could be made in milliseconds. Capitalizing on this trend, Reuters recently introduced a service called Reuters NewsScope Archive, which tags Reuters-issued articles with digital IDs so that an article can be downloaded, analyzed for useful information, and acted upon almost instantly.”
I’m struck by the imagery of (if not already, then sometime very soon) the words in a speech being semantically indexed from a live broadcast, and each word effecting the markets. Stunning.
Also, how the different analysts are using computers to comb through all this data, looking for any discrepancies and capitalizing on that, but then I imagine the size of those discrepancies must be reduced by all the scrutinizing activity, and that the pattern hunters must now be analyzing and acting on a sea of behaviors from all the other pattern hunters.