Re:Algorithmic Trading: The Play-at-Home Version
by gnaritas on Tuesday August 11, 2015 @01:42AM
(#10039286)
> In reality, two parties can walk away from a trade believing (in the moment) that they got the better deal.
In reality, two parties can walk way not just believing, but actually getting the better deal. Both parties can be winners, there is not always a loser when a trade is made. One guy could be exiting a long while profiting taking while the counter party is opening a short, and they can both bank profit from the trade. Maybe one is hedging and doesn't mind if the trade goes against him because it's hedging another trade in his portfolio to keep him market neutral. The idea that one guy wins and one guy loses is simply far to simplistic.
In reality, two parties can walk way not just believing, but actually getting the better deal. Both parties can be winners, there is not always a loser when a trade is made. One guy could be exiting a long while profiting taking while the counter party is opening a short, and they can both bank profit from the trade. Maybe one is hedging and doesn't mind if the trade goes against him because it's hedging another trade in his portfolio to keep him market neutral. The idea that one guy wins and one guy loses is simply far to simplistic.