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Stock traders use algorithms to cash in on Trump tweets


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2017 Jan 18, 5:22pm   790 views  1 comment

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Some sophisticated traders with automated programs are using computer algorithms that instantly capture Trump’s Twitter remarks and then immediately buy or sell the affected stocks, analysts said.

Wall Street is tight-lipped about which firms use the automatic trading programs in their bid to profit from Trump’s tweets, and it’s unclear how much of the stocks’ trading volume reflects the automated trades.

Representatives from venerable investment firms such as Goldman Sachs Group Inc., Morgan Stanley and Bank of America’s Merrill Lynch all declined to comment. So did Citadel Securities, a well-known automated trading firm that also operates a hedge fund. Gits likewise said he was not at liberty to disclose the names of traders using such automated programs.

The secrecy isn’t surprising because firms employing the programs, which try to profit from even modest point spreads on high-volume trades, don’t want to reveal their advantage, said Josh Brown, chief executive of Ritholtz Wealth Management who also runs the Reformed Broker website.

The software and algorithms that enable Wall Street’s high-speed traders to respond automatically to Trump’s outbursts weren’t developed specifically in the aftermath of Trump’s defeat of Hillary Clinton on Nov. 8, analysts said.

“It’s been around for a time predating Trump,” Brown said. He pointed to how past tweets by Clinton, billionaire investor Carl Icahn and Tesla Motors Inc. Chief Executive Elon Musk, among others, have sparked immediate moves in stocks of companies they mentioned.

http://www.detroitnews.com/story/business/2017/01/18/stock-traders-use-algorithms-cash-trump-tweets/96736956/

#Stocks #Investments #Economics

What is the likelihood of one or more entities such as Goldman Sachs etc. getting information pre-tweet and reaping the rewards not to mention well placed political donors and run of the mill legislators? Not that this type of thing would ever happen or occurred in the past...in either party, but who knows.

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1   🎂 Tenpoundbass   2017 Jan 18, 5:39pm  

Elections MAGA Commerce Squared.

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