SEBI's new algo trading norms 2016. what changes do you except?

[mutualguru]

I am reading this news article http://www.livemint.com/Money/VKmE9...-algorithmic-trading-by-end-of-2016-Sebi.html about sebi's new norms on algorithmic trading. It seems they are going to curb down on HFT trading and algo tradings carried about by corportes and HNIs. But they are not talking much about retail traders and algo trading, Do they allow algo trading for retail traders?What are your opinion and views?

 

[TradeOptions]

I am reading this news article http://www.livemint.com/Money/VKmE9...-algorithmic-trading-by-end-of-2016-Sebi.html about sebi's new norms on algorithmic trading. It seems they are going to curb down on HFT trading and algo tradings carried about by corportes and HNIs. But they are not talking much about retail traders and algo trading, Do they allow algo trading for retail traders?What are your opinion and views?

Thanks for sharing this information mutualguru

Since SEBI is still working on it and have not finalized any new norms yet. So we can use this thread to share progress of SEBI actions in this regards.

I am really shocked to see this part of the article -

According to a 13 April Mint report, the share of HFT trading as a percentage of overall trading has been growing consistently. In 2011-12, HFT orders as a percentage of overall orders in the cash equity segment was at 65%.

This has gone up to 94% in 2015-16. HFT turnover as a percentage of overall turnover in the cash equity segment has gone up from 25% to 42% over the same period. In the equity derivatives segment, the percentage of HFT orders has gone up from 78% to 98% between fiscal 2012 and fiscal 2016

HFT orders contributing 98 % in the equity derivatives !
Although I am sure they would not be executing most of these orders, otherwise the whole game would become controlled by HFT. But still it means that they put a lot of orders in the order book for spoofing other traders or algos etc. which look at the order book for taking trade decisions. Just as our friend "timepass" has a tendency to keep an eye on the orderbook of his favorite stocks. Now he must know that HFT guys are trying to spoof him with fake orders in the order book. :lol:

Thanks and regards

 

[vikas2131]

Big portion of HFT is used for front running retail traders orders...Curb on HFT is right decision by SEBi and i support it..

 

[amitrandive]

Recent global event such as Brexit and the subsequent volatility in the currency market has spooked a lot of investors. Increase in Risk aversion following such an event is a natural outcome, as market participants exercise caution while trading.

However, even during such tumultuous times, automated traders are having a field day. According to media reports, hedge funds using algorithmic trading are regularly outperforming the manual traders, and especially during such stressful market conditions.

Source:QuantInsti Quantitative Learning Pvt Ltd ,Seminar registration link.

 

[pannet1]

Why not use SL order and chase the target price. small effort and no surprise. i hate surprises and with the odds against us are so high one should not leave 1 Paise to the market. I would better give it to a beggar or donate than market.

feeling very sad bro.

 

[pannet1]

Makes me sad.

I am not even fit to be called novice. But I think could it be something to do with the fact its weekly options.

Please ignore if its irrelevant.

 

[CommoBro]

I think HFT is good for retail traders, as they provide liquidity and volume to market.