Trading Tech Talk

CTO Interview: Today we feature special guest co-host Peter Maragos, CEO, Dash Financial. Catching up with Dash: When Peter was last on Dash had just acquired the LiquidPoint business from Convergex with the help of private equity firm GTCR. Now they've just partnered with Flexpoint Ford, another PE firm. What was the impetus behind the second transaction? Dash has an impressive suite of diverse products and services - smart order routers and algos, the Dash360 analytics platform, trading workflow tools, an options ATS and even human traders. What are the upcoming projects/initiatives at Dash? Peter's views on crypto trading Hot Topics in Tech: Smart Routers Today's topic was inspired by the following listener question: Question from See16: Can you please do a deep dive into smart routers on a future program? They are the secret sauce of the market these days but no one really seems to understand how they work. Shedding some light on the otherwise dark world of routing would be a great service. Smart Routing Deep Dive: Quite a few things happen after you hit the trade button in the options market - probably much more than most people realize. Your order has to get routed from your broker/execution platform to the exchange. But it's not a simple path. That's where smart routers come in. What is a smart router? What do they do? What makes them smart? What are the different rules/filters/configurations that most smart routers have to consider? - NBBO, exchange fees, size, exchange pricing model, PIP auctions, payment for order flow rates, etc. What about resting orders? Are the smart routers constantly monitoring them and rerouting if necessary? Why do we need them in the options market? How do options smart routers differ from equity smart routers? Why have smart routers become so controversial in the options market? Spreads: This is the Achilles heel for many "smart" routers since every exchange has its own spread book and they don't talk to each other. So you could easily work a spread order that lines up on one exchange but, because your order was routed to a different spread book, your trade isn't filled. How do we overcome the spread routing issue in 2018? Is it a tech problem or a regulatory problem? Final thoughts/takeaways on smart routers? The Inbox: Listener questions and comments Question from Nikes T: Hey Options Insider! Love the network particularly the tech talk. We need more episodes! On an upcoming show do you think you guys could talk about why dark pools don't exist in the options market? Is it a tech limitation or something else? Question from LaLaLad: Does block chain have any practical use on the trading front or is it all just back office stuff?

Mark is joined by co-host Matt Amberson, Principal at Option Research & Technology Services (ORATS). CTO Interview: Our guest today is Michael Mescher, Founder of Gammon Capital. He discusses: What is Gammon Capital? You've talked a lot about the dangers of selling volatility and how short vol managers aren't worth their fees. What are your thoughts on the maelstrom of the past week? How have your funds fared over the past week? Machine learning is a hot buzzword these days, but what are some of the practical applications that you're seeing in the financial markets right now? Is it ready for prime time or still in the nascent phase? Unsupervised learning/ fundamental strategies? Supervised learning / quantitative strategies? Classification vs. Regression problems Hiring machine learning specialists vs. Products specialists 90% of the world's data was created in the past two years. Is that an opportunity or a terrifying statistic? Testing models on out-of-sample data vs. carefully constructed back tests? Should managers be concerned that the robots are coming to take their jobs and their clients? The Inbox: Listener questions and comments Question from BLAL9 - What do you see as the outlook for AI and machine learning in the financial management space going forward? I see a lot of smoke but is there much fire? Are there many funds currently using it to generate alpha right now? Question from Tonc - What are the best ways to invest in blockchain right now? Question from Mark Kalis - How are comps getting the edge on us in trading? Is it just pure correlation trading? Comment from tDok3 - No debate to be had there. It's a simple & foregone conclusion. Higher fees ==> lower participation perhaps goal for CB market manipulation In response to tweet: Are exchanges shooting themselves in the foot by continually hiking market data fees? Question from See16 - Can you please do a deep dive into smart routers on a future program? They are the secret sauce of the market these days, but no one really seems to understand how they work. Shedding some light on the otherwise dark world of routing would be a great service.

Today we have special guest co-host Rob Brogan from Flextrade. Hot Topics in Tech: What's going on in fintech? NYSE wins approval for 'speed bump' in trading Bloomberg is taking a shot at the New York Stock Exchange (again) Exchanges becoming tech firms Machine learning is transforming investment strategies for asset managers

CTO Interview Featuring Jesper Alfredsson, President Americas at Itiviti. He discusses: What is Itiviti? The history of CameronTec Who is the target market? Finding the middle way for infrastructure expansion Don't spend time on the plumbing Recent upgrades, including smart order routing for options orders Hot Topics in Tech: The tough new cybersecurity rules in New York Risk managers under pressure to cut down on post-crisis spending Hedge funds adopt novel methods to hunt down new tech talent

CTO Interview with Jack Schwager: Author extraordinaire and now co-founder of Fund Seeder. Mr. Schwager is the author of Market Wizards, Hedge Fund Market Wizards, A Complete Guide to the Futures Markets: Fundamental Analysis, Trading Spreads and Options (and the second edition just hit store shelves!) He discusses: Was he surprised by the reaction to Market Wizards? How did that book come about? His new project in the trading tech space: FundSeeder What is FundSeeder? How does the funding process work? Do traders have to reveal their secret sauce in order to receive funding? Hot Topics in Tech: What is on our radar from a tech perspective? Tech firm creates Trump monitor for stock markets. A London-based Fintech firm Trading.co.uk is launching an app that will generate trading alerts for shares based on comments made on social media by Donald Trump. Launching an open-outcry trading floor? How very 21st century.Box Options Exchange is building the first new trading floor in Chicago in decades - Boyle expects to attract traders who prefer open outcry for big orders and keep them with a more efficient 21st-century floor model.

Hot Topics in Tech. Today we are featuring Alexander Lamb, Head of Business Development at The Technancial Company. Alex was previously a guest in March 2016. (You can access that episode here.) Risk Management and AI: effective or ??? Its penetration into the business world has brought with it new services which aim to help automate and speed up a range of activities, including financial risk management. Wall Street next tech frontier is hacking into emotions of traders. Banks have already set up big-data teams to harvest insights from the terabytes of customer information they possess. Now they are looking inward to see whether they can improve operations and limit losses in their biggest cost center: employees. Tech is driving consolidation in the exchange space. CBOE Holdings Inc., agreed to acquire Bats Global Markets Inc. for about $3.2 billion to expand into stocks, ETFs and currencies trading. Exchanges defeat appeal of U.S. high-frequency trading lawsuits - A federal appeals court on Friday rejected an investor's attempt to revive lawsuits accusing major U.S. exchanges of selling early access to market data to high-frequency traders, the subject of Michael Lewis' 2014 best-seller "Flash Boys." The Inbox: In which the listeners take control Question from Andrew Simmons: There is lots of acronym soup in trading tech. Two terms I have heard bandied about quite a bit are EMS and OMS. Can you explain these terms and maybe their similarities or differences? Question from JVigs: Are there any independent third party services I can use to analyze my margin and options buying power? This seems like a bit of a dark art these days in the options market. I do not really agree with the numbers generated by my broker and it would be nice to have some data in my corner. So much effort is devoted to trading in milliseconds but this important part of the market remains relatively untapped. Recommendations please. Great hit with Howard from StockTwits. Keep it up.

CTO Interview: Today we are featuring Howard Lindzon, Founder of StockTwits, and Founder of Wallstrip. He discusses: Wallstrip and its flip to CBS The genesis and evolution of StockTwits Twitter pulling the rug out from under StockTwits How does StockTwits generate revenue? Stocktoberfest (Register today for Stocktoberfest) Hot Topics in Tech: IEX finally approved putting a 350 millisecond speed bump in place. Only two stocks will be available to trade on the opening day on Friday with another eight securities will start trading on IEX August 24 - August 29, IEX will begin listing a much wider universe, including all NYSE and Nasdaq-listed stocks. Renaissance Technologies hopes to use physics to battle Wall Street speed demons. Their plan involves algorithms, servers and the worlds most accurate timekeeper currently used for GPS satellites and deep space exploration, the atomic clock.

CTO Interview: Today we are featuring Jason Pang, CEO of Sparkfin. He discusses: What is Sparkfin? What makes the Sparkfin Watchlist app unique? What was the genesis of this? Were the Sparkfin people just fed up with current watchlist offerings? Is the plan to remain a standalone service or to license the app to brokers as essentially a plug-and-play community module? Is it possible to execute through the app directly? Does Sparkfin offer curated lists as well? How does that work? Who curates them? What about paper trading / tracking? Can that be done through the app? Any plan to expand beyond stocks in the future? The Inbox: Listener questions and comments Question from Alan Fromme - What is the future of market data? Will we ever see an era when the great monopolies are broken, and this data comes freely, or reasonably available to all? Question from NanFan - Caught you panel and the after show on your network. Great job particularly on the market data. I particularly enjoyed hearing the smaller firms perspective. It seems like market data is an endless black hole of costs for firms like that. Is there any hope for new firms in this space when it comes to pushing back on market data fees? Perhaps regulatory relief or a coalition of market data vendors that can push back against the exchange monopolies?

CTO Interview: Today Mark and Henry are joined by Ryan Hansen, President of the new futures brokerage, Tradovate. They discuss: What is Tradovate? The benefits of multi-platform trading applications Membership pricing advantages Futures leading the way in tech Does the cost include payment for order flow? Will options ever be included on the platform? You can find out more at tradovate.com/trial Hot Topics in Tech: What is happening in trading technology? Silicon Valley to the rescue? The Long-Term Stock Exchange IEX: all they want is a speedbump Trading prompted by social media: CBOE S-Factors Petterfy looks at the future of the brokerage space

Hot Topics in Tech: SEC says cyber security biggest risk to financial system. Fed should better safeguard economic data, internal watchdog says. A new trading floor in 2016? The options market turns to old tactic. CME upgrade soothes critics who viewed prior system as unfair. Nasdaq to unleash the machines on insider traders through Smarts investment. Why the SEC should just say "no" to IEX. Can a $24 Billion hedge fund blow the whistle? Citadel thinks so. Blockchain Roundup: Inside the secret meeting where Wall Street tested digital cash. DTCC holds a blockchain conference. Microsoft Azure partners with R3 blockchain consortium. Red Hat announced the Open Shift Blockchain Initiative. CME Group bites on bitcoin, will now publish daily price. The Inbox: Listener questions and comments Question from Jane Neal: Does Trade Alert or Whats Trading off data on futures? Question from George Constopolis: Why is most stock and options settlement still T+3? Can we not get that down to a more reasonable time frame with the current technology?

Live (to tape) at OIC 2016, Mark and Henry are joined by: Jesper Alfredsson, President Americas at Itiviti Karan Sood, Founder & CEO, Vest Financial They discuss: Is there one clear path that people should take for disseminating data? Hitting the pause button your portfolio API vs. UI The double-edged sword of flexibility Market data and the ensuing revenues Getting to the point of regulation on fees AI as it applies to the industry Wrecking the market through good intentions The proliferation of trading venues and the impact on business

Hot Topics in Tech: Henry is a hot topic! At least, he presented hot topics at the OIC Conference. Growth lately has been in ETF and index options, with equity options lagging. So many new additions, from expirations to exchanges, have exploded the amount of data. More exchanges? If you build it, will they come? Updates on the institutional and market maker spaces. The illusion of price improvement. Auctions? The deathknell of the options market, or necessary evil? 3x growth in five years for products. Should this growth be trimmed? More trading floors. Physical floors. Indian patent act. Milestones in fintech, going back to the 1800's. The Inbox: Listener questions and comments Anthony J: Those new chip cards slow down the payment process to a crawl. Is there some fintech solution to make this better? ABC Markets: Which broker platform offers the best tech to its clients? I like IB and TOS

CTO Interview: Today, Mark and Henry are joined by Karan Sood, CEO of Vest Financial. He discusses: An overview of your background in the financial technology space What is Vest? Who is the Vest target consumer? Can users choose between custom portfolio overlays and pre-designed protection packages? Are these algorithmically generated or designed by humans behind the scenes? Does Vest charge commissions or is there an annual fee? How does this platform differ from TradeLegs? How did Vest become involved with the CBOE? Vest also launched some targeted “buffer indexes” with the CBOE, tell us about those. Hot Topics in Tech: IEX asks for SEC exchange approval on merits of its application - IEX on Monday urged regulators to give the green light to its application to become a fully-fledged exchange outside of a broader debate that its plan has sparked about stock trading rules. CME calls time on New York open outcry options floor - The move follows the closure last year of its open outcry futures pits in Chicago and New York. The Inbox: Listener questions and comments Question from JCrow - Refresh my memory. Why the heck can they not update OI more often than once a day? Is it a technical problem or something else?

Hot Topics in Tech: Today we are joined by guest co-host, Mark Melin from ValueWalk Vesel, LLC and Trade Alert, LLC join forces to provide specialized buy side listed options messaging - FinTech Companies will use customized alerting system to notify buy side clients of option trades mirroring their individual Watch List. Is IEX battle nearing end as rival exchanges adopt their technology? by Mark Melin - Recent movements by rival exchanges, buttressed by the very public outreach of some firms participating in the IEX debate, have raised the specter that the IEX Exchange could be gaining momentum. SEC to delay IEX stock exchange decision until June: reports - Another day, another delay for the upstart "Flash Boys" trading venue that wants to be a stock exchange. As an exchange, IEX would not be fair, simple or transparent - Larry Tabb, Tabb Forum. The first exchange in the "cloud" - ISE announces first implementation of a securities exchange on Amazon web services cloud computing environment. Inside the nondescript building where trillions trade each day - Equinixs NY4 data center in the Secaucus, New Jersey. High-speed trading remains risky, by Sal Arnuk and Joseph Saluzzi - Is sponsored academic research a threat to our financial markets or an important innovation that benefits todays investors? The Inbox: Listener questions and comments Question from Angeman - How is HFT impacting the futures markets? Is it as prevalent as in stocks?

CTO Interview: Today we are joined by Paul Giedraitis, Principal at Neurensic. They discuss: An overview of Paul's background in the trading technology space? What is Neurensic? What sort of market manipulation can Neurensic's software detect? Spoofing? Layering? Other? It is bizarre that an old exploit like spoofing has become such a hot button topic in 2016. Hot Topics in Tech: What is going on in financial technology? CFTC signals retreat over 'source code' repository. The US futures regulator has signaled a willingness to back down on controversial proposals allowing it to freely access the source code of high-speed traders, following complaints that it could lead to sensitive intellectual property being revealed. SEC brings new charges over global press release hacking scheme. The U.S. Securities and Exchange Commission has charged nine new defendants over what it has called a more than $100 million international scheme to hack into newswires that distribute corporate press releases and to use stolen information to conduct insider trading. Robots are reading trader chats to stop the next wave of bank fines. Robots are automating yet another bank job: the task of sifting through traders’ messages to spot foul play, a process currently carried out by legions of human employees. Do not give away the store when enabling APIs. Application programming interfaces, which have been available but in a limited manner, are used to let different software applications communicate and exchange data with each other.

CTO Interview: In this segment, Mark and Henry are joined by Alexander Lamb, head of Business Development at the Technancial Company. They discuss: Margin calculations, and the behind-the-scenes voodoo The Janus margin engine, and real-time margin calculations Is real-time risk and margin a response to the new regulatory environment? Avoiding latency What is the engine driving the machine? OTC and the migration to listed options Fragmentation and the resulting complexities Janus risk management, market surveillance and compliance capacities How do they deal with fragmentated data Increased precision on timestamps, and the added complexities as a result Are there any inklings of systemic risk on the horizon? The Inbox: Listener questions and comments CFTC and SEC can't handle the new era of trading. What about a new cyber-regulator? Are the exchanges to blame for the rise of HFT?

Trading Tech Talk 47: Blowing the Whistle on HFT CTO Interview: Today we are joined by Haim Bodek, Managing Principal of Decimus Capital Markets, LLC. Haim founded Trading Machines and is featured in the book Dark Pools. Featured article: Vice - What led whistle-blower Haim Bodek to expose the biggest scam on Wall Street? He has said Flash Boys misses the mark, what did he mean by that? What are his thoughts on IEX? What changes do we need to do to make REG NMS more effective? Hot Topics: What is buzzing Tired of boogeymen portrayals, speed traders take to NYSE floor - Automated traders have an image problem. What better way to address it than to set up shop in one of the most iconic spots in global finance: the floor of the New York Stock Exchange. Citadel Securities and Global Trading Systems LLC recently agreed to buy NYSE floor-trading businesses. How prevalent and profitable are latency arbitrage opportunities on U.S. stock exchanges? This paper provides evidence that high-frequency traders have numerous opportunities to realize profits from latency arbitrage. CFTC signals retreat over "source code" repository The US futures regulator has signaled a willingness to back down on controversial proposals allowing it to freely access the source code of high-speed traders, following complaints that it could lead to sensitive intellectual property being revealed.

Hot Topics in Tech: CFTC too broke to properly police flash traders, Massad says -The top U.S. derivatives regulator said his agency needs more money to keep up with the Flash Boys. Cattlemen vs CME - Round 2. Cattlemen asked for numerous changes. IEX battle heats up - Citadel has been one of the most vehement objectors to IEX, and has filed three public letters and held three meetings with SEC officials to lobby against the application. Aquis Exchange to ban predatory high-speed trading - A start-up European share trading venue is aiming to reboot its fortunes by banning aggressive high-speed trading from its platform. High-frequency trader warns of potential market "catastrophe" - The head of one of the biggest high-frequency trading companies has warned that there are several faultlines in the structure of increasingly electronic, automated financial markets that could lead to a “catastrophe” in the long run. Blockchain Update: IBM Director declares 'We’re all in on Blockchain" - John Wolpert gave a keynote speech covering the deficiencies in the approaches being taken by today’s blockchain developers and why he believes a more collaborative approach is needed to bring the tech to market. Bitcoin outage - NADEX detailed a halt in trading of its daily and weekly bitcoin binary contracts, based on the so called unavailability of the price index that underlies the contracts. The Inbox: Listener questions and comments Comment from Tom, Henderson, NV - I live on the cusp of civilization out here, so I have no choice but to take a more position oriented view on trading. I am not saying that I want to be a market maker of HFT but how funny is it that today your location (or more appropriately your connectivity) dictates your trading style? Seems somewhat backwards to me. Question from N Filasco - I am over Blockchain. What is the next thing?

CTO Interview: Today we are joined by Eric Scharf, Director of Marketing, EOX Live. They discuss: What is EOX Live? The evolution of the nat gas market Going from phone calls to electronic trading What about spread trades And more Hot Topics in Tech: Cattlemen vs. the CME. IEX exchange quest spurs a "Flash Boys" fight with Citadel. Blockchain update: Security concerns, more money for startups and question from clearing firms. The Inbox: Listener questions and comments Question from Allanon - You discussed trading via smartphone in the previous episode. I think the real revolution will be trading via virtual reality. Can you imagine standing inside a swirling sea of quotes and literally picking you trades out of the air? Forget the GUI. It will all be about virtual user experience. Question from JVicks - What is the next market that will fall victim to predatory HFT?

Hot Topics in Tech: The worst start to the year since forever. Unfavorable light shining on China, raising the debate on circuit breakers. NASDAQ uses blockchains in the first large-scale trade, or so they say. Symbiont disagrees. Will blockchains be the HFT of 2016? The tech opportunities created by the regulatory environment. What have SEFs done to the world of swaps? The Inbox: Listener questions and comments Comment from Jim B. - Will there be TTT awards for the best and worst developments of 2015? Question from George S. - How far are we away from being able to be a professional prop trader from a beach in Tahiti? When can we do all of this from our smartphones? Question from Big Bob - Is there open source software in the finance industry? Question from Sarah R. - Can you explain what a matching engine is and how it works? Question from Leo10 - Who was your favorite guest from 2015? Question from Jim B. - What is the optimal tech set up for the aspiring active retail trader?

Hot Topics in Tech: Top Tech Trends and Developments of 2015 Blockchain revolutionizing the back office HFT is evil again HFT not as profitable as originally thought Exchanges spending money on tech startups Regulators are changing the technology landscape The auction tech impact Favorite/Craziest Stories of 2015 Russian hackers stealing press releases from wire services The August flash crash Russia threatening to use HFT to crash the markets NYSE outage The leap second Twitter trading algos/bots Things We Do NOT Want to Talk About in 2016 Spoofing HFT is evil Dark pool tech More possible options exchanges

Hot Topics in Tech: A quick rundown of the Options Alliance Event & Financial Startup Showcase from Dec 10, 2015. CFTC cracks down on HFT - New rules open to public comment. New study: Robotic trading is killing Wall Street jobs. Blockchain for banks still at the "gluten" stage. The Inbox: Listener questions and comments Question from JVSchultz - FinTech was all the rage in 2015. What are you top upcoming trends for 2016 in Trading Tech? Question from Ntander - You have commented many times on the inability of the current regulators to keep up with the exploding technology in the financial markets. Do you think there is support for a dedicated technology regulator separate from the SEC and CFTC? This body would solely focus on the technology aspects of the markets and leave the regular market regulation to their counterparts. Thoughts? Comment from Karrigan - Ever thought of special episodes that focus on different segments of the market. Maybe an Ags Tech episode, a Metals Tech episode, etc.

Hot Topics in Tech: ICE agrees to acquire BGC Trayport for $650 million. NYSE goes from fan to critic of IEX, criticizing "unfair" plan. Derivatives exchanges see use for blockchain technology. High-speed firms add new perspective to treasury advisory group - KCG Holdings Inc. and Virtu Financial Inc. The Inbox: Listener questions and comments Comment from Aman117 - Ever thought about hosting a cyber security roundtable on the show with exchange, broker and trading firm CTOs? Talk about who is hacking them and what they’re doing to stop it? Could be interesting. Question from Amanda F - Looks like budgets for #tradingtech are dwindling with much of that money going toward comp and reg. Any bright spots on the horizon that the tech spend may be increasing or is regulation going to continue to rule the day. Question from JVZ16 - What do you think it will take to get stock and options exchanges to adopt the speed bump that you advocated on the last episode? A catastrophic error or failure of an HFT firm that causes massive losses and negative publicity? Question from Big Rig - Love the program. You and henry breaking stuff down every month makes my long hauls a little shorter. So thanks for that. I have heard you guys discuss the problem of the lack of new market makers in the biz. Can technology not replace some of that? We have already got robo-advisors. Do you foresee the day of the robo-market makers anytime soon? Question from Cookie -What is the best online platform for stock options and futures options?

Hot Topics in Tech: U.S. trader found guilty in landmark "spoofing" case. U.S. regulator signals bid to curb high-speed trading. Exchanges face pressure to disclose high-speed trader perks. CME experiments with real-time margin payments, unveiled a deal with Dwolla. CBOE expands EMS connectivity between traders and workstations. Orc Group merges with CameronTec to jointly foster trading solutions. The Inbox: Listener questions and comments Question from Angelo Myers - Loved the deep dive into FPGAs last episode. I am a hardware wonk. What other hardware developments do you feel have been crucial to the trading landscape? Options or just general financial? Question from JimWow -Hello team! Can you please explain what a complex order book is and how it works? Question from Bill Williams - Lots of talk about putting a speed bump into the market to stop or slow down HFT jerks. Thoughts? Will it work or will the Cybermen just figure out a way around it?

Hot Topics in Tech: Russian hackers of Dow Jones said to have sought trading tips. High speed trading becomes US election issue. Regulators bring "spoofing" charges against a Chicago firm. UK start-up claims blockchain breakthrough in payment processing. Nasdaq eyes dark-pool surveillance market."Flash Boys" heroes ask for stock exchange status. The Inbox: Listener questions and comments Question from TCity - What is the status of the regulatory proposal to register Algo developers? Do you feel this has a good chance of being passed? Question from Tom M., Boca Raton, FL - Can you guys please discuss the net neutrality debate on your program and its possible ramifications in the trading world? Thank you for your excellent program even if much of it goes over my head. Question from A. Butler - Hello mark and team. I would like to submit a discussion topic for the trading tech talk program. Can you please discuss the benefits and drawbacks of AWS when it comes to financial services? It seems like AWS has become the backbone of many other industries but does not seem to get much mention in the trading space. Is this simply due to the somewhat slow adoption of cloud infrastructure in the financial markets?

CTO Interview: The guest today is Mike Dunne, CTO at Activ Financial Systems, Inc. He discusses: An overview of your background in the derivatives markets What is Activ Financial Systems Inc.? Who is their typical end user? Scale, Market Data and FPGA Going live with Nasdaq Basic. Hot Topics in Tech: Java at 20 - its 6th major version was released this year. Goggle + Symphony? - Goldman Sachs-backed Symphony raised $100 million in new funding on Monday from search giant Google and others. The Inbox: Listener questions and comments Question from Averyflynn - Tech Team - How about a show about margin tech and margin risk tech? Seems like a hot segment of the industry.

CTO Interview: The guest today is Robert D'Arco, CEO, Rival Systems. He discusses: An overview of your background in the derivatives markets. What is Rival Systems? Who is the target end-user? The Rival Risk Analytics Suite. Hot Topics in Tech: What’s happening in the world of fin tech? Technology groups warned on stricter financial regulation - The chairman of HSBC has said that regulators in China and elsewhere are starting to consider more seriously whether technology companies that provide financial services should, like banks, be regulated more heavily. Blockchain initiative called R3 backed by 9 large investment banks - Nine of the largest investment banks, including Goldman Sachs, JPMorgan and Credit Suisse, are planning to develop common standards for blockchain technology in an effort to broaden its use across financial services. Bloomberg and Twitter sign data licensing agreement - The long-term data agreement with Twitter will further enhance financially relevant information found on the social media platform for users of the Bloomberg Professional service. The Inbox: Listener questions and comments Question from TomTom08 -Hello TT crew, love the show. Hope you grin back the Lightning Round soon. I would like you guys to comment on OpenFin (https://openfin.co/) and how it can extend the capability of HTML5 for FinTec providers.

Hot Topics in Tech: Investors Lose in Today's Markets, Says Former NYSE Head Grasso. NYSE Draws Users' Ire with Fee Increases, Patent Charge Proposal. Mini flash crash? Trading anomalies on manic Monday hit small investors. Algorithmic Trading: The Play-at-Home Version International HFT Backlash: China targets high-frequency traders in "spoofing" probe Symphony is just the latest attack on Bloomberg's fortress 3Red set for "spoofing" legal battle The Inbox: Listener questions and comments Question from GG: Has there ever been talk of some sort of technology glitch or shutdown futures? In the wake of the NYSE problems it seems there would be a fertile market for such a product. Firms could hedge themselves against system risk. Please discuss. Question from Cybortrader: when the race to zero winds down to its inevitable conclusion what do you think will be the next big battle ground for HFTs? CPU/GPU cycles? Co-location proximity? Where will the war rage next? Thank you for your thoughts. I very much enjoyed the episode with Thomas Peterfy of interactive brokers.

Hot Topics in Tech: A Massive Selloff. Interesting data and tech insights from the recent pronounced selloff in the market. "Here's the advantage high-frequency trading firms have over everyone else," says Eric Hunsader, founder of Nanex LLC, the U.S. financial markets consultancy. BATS gets regulatory nod for second U.S. options exchange. BATS files client suspension rule to expedite action again HFT spoofers. The Inbox: Listener questions and comments Question from Dariush - Question for trading tech talk radio program. Hello mark. I heard on one of your recent programs that there were system issues preventing OPRA and other platforms from adopting the VIX weekly futures and upcoming options. Do you have any insight into why these specific products would cause issues for technology vendors and platforms? Thank you for your time.

CTO Interview: Today we are joined by Michael Barry, CEO & Founder of EESAT. He discusses: An overview of his background in the markets and how he started EESAT Who came up with the idea to put Burt Reynolds on the website? Listener question from Leonard Garcia - Can you explain what a complex order book is? Thanks and love the show. 35-40% of daily contract volume in non-index is spread- 70% on ISE! How does EESAT reconcile the varying functionality of the different order books at the different exchanges? Who is the ideal end user of EESAT products? How do we solve the problem of spread execution across complex order books? Where can listeners go if they want to learn more about EESAT? Hot Topics in Tech: Ukrainian cyber-criminals hacked newswires to steal company data and raked in millions of dollars.

Hot Topics in Tech: What do you need to know about financial technology? A technical glitch postponed the start of trading in futures and options contracts on Eurex by more than two hours, the latest in a run of breakdowns by exchanges. Exchanges around the world are avidly wooing high-frequency traders, those controversial speed demons of Wall Street. Despite the often explosive debate over this kind of trading in the U.S., bourses in Mexico, Turkey, South Africa and beyond are trying to lure HFT types to boost business. China, perhaps the last big obstacle to high-frequency trading achieving global dominance, where tight government rules, a stamp duty on stock trades and market inefficiency have so far kept out the algobots. High frequency share trading, which favors “predatory strategies that queue jump institutional and retail investors”, is having a toxic effect on Australia financial markets, according to researchers at the Business School. NY AG preps case against Credit Suisse dark pool - New York Attorney General Eric Schneiderman is preparing a civil case against Credit Suisse AG (CS). CMEs power of electronic trading let it acquire Nymex: The importance of technology was demonstrated again when CME saved Nymex from disappearing. A new report by regulators admits that there was an unusual amount of "self-trading" leading up to the October 15 bond market flash crash. The Treasury market, officially, had its own flash crash. The Inbox: Listener questions and comments Question from GG: Has there ever been talk of some sort of technology glitch or shutdown futures? In the wake of the NYSE problems it seems there would be a fertile market for such a product. Firms could hedge themselves against system risk. Please discuss. Question from Eli Minn: Good discussion of the NYSE meltdown. I came away from it agreeing that tech actually saved the day. I guess fragmentation is good for something after all. Question from TJD: I know you guys were joking when you talked about HFT boats and blimps. But has there been any serious application of drone tech in the trading world? I have seen them used for combat, photography, movie-making, science experiments and more. Why not trading?

Hot Topics in Tech: NYSE glitch: what happened? A Lesson from the NYSE Outage: Fragmentation Works. Leap second was not a mini Y2K, but more of a tempest in a teapot. No major outages or calamities as a result of the leap second. Derivatives market concerned by trade reporting costs. A Bitcoin technology gets NASDAQ test. The Inbox: Listener questions and comments. Question from SemperFi: Do you guys think it was really a hack that brought down NYSE? NYSE, WSJ, United and Reddit? Seems fishy to me. Comment from Technation: I very much enjoyed your interview with the CEO of IB. It was a far reaching conversation that covered many topics. It is interesting to see early pioneers in computer trading now pushing back against the modern iteration. I suppose there's a certain amount of karma at work there. I also found his final comment that he supports new startups not by investment but by providing discounts to his own services to be very revealing. I'm already looking forward to your next episode. Question from Nikolai: Why do you think so few outside investment funds and venture funds invest in trading-related startups?

CTO Interview SegmentToday's guest is Ben Londergan, Executive Managing Director, Options Trading and Technology at Convergex.He discusses: Algos: The growing suite of options algos under development at Convergex including Sweep, Capital Commitment, Buywrite, Delta Neutral and much more. Reg SCI: Why is it so important and what impact will it have on the trading technology landscape. Floor vs. Tech: Bringing floor-based tech to the upstairs trading crowd. In this world of sub-second executions what value does he see the trading floor bringing to the table? And much more. Hot Topics in Tech Mini Y2K - Traders anxious ahead of extra second in day. Complex US options market hampers liquidity - report Lightning Round What sector has more billionaires - finance or tech? Is the race to zero over? The Inbox: Listener questions and comments Question from Alan Park - Why is open interest not calculated instantly? If I buy 10 puts to close, why is that not automatically reflected in the open interest displayed by the exchanges? Is it not outdated to update such an important metric only once a day? Question from Elly Sanders - We have dark pools in stocks. They do most of the volume on some days. Why do we not have them in options? Will that ever change?

CTO Interview: Mark and Henry are joined by Thomas Peterffy, Founder, CEO and Chairman of Interactive Brokers. They discuss: The HFT Sector The impact of the HFT sector on the marketplace Thomas' proposal for introducing a random amount of latency into the system Robotic typing and the benefit of leveling the playing field Mid-day auctions Static versus random delays Should developers become registered representatives? Exchange fragmentation Being against HFT vs. being for payment for order flow Is there a technological solution to the problems associated with spread books vis a vis market fragmentation? The flight of liquidity providers The Probability Lab Tools for advisors, and what Interactive Brokers is doing for that audience The Covestor acquisition

In this episode, Mark and Henry are joined live at the Options Industry Conference by Rob Brogan from FlexTrade. CTO Interview: Today's guest is Rob Brogan, Vice President of Options Sales at FlexTrade. They discuss: What is FlexTrade? FlexTrade's work with CBOE What's new at FlexTrade? Smart routing, algos, and more Complex order books Hot Topics in Tech: The jury weighs in on the guy who stole HFT code from Goldman Sachs. Stealing code. TWTR accidentally releases earnings via Tweet and the speed of information is on display. Hunting down people Tweeting proprietary content. The Inbox: Listener questions and comments, including cheaper data, a la carte options, and more.

Hot Topics in Tech: Today's guest is Mark Haraburda, Managing Director at Barchart who gives an overview of Chicago FinTech Exchange 2015. Overheard @FinTechChicago: "Latency will be a historical market structure discussion." - Let's hope they're right! IBM Watson may be a little scary to some participants. Cloud is also scary for many firms. Plans for the future Also of discussion today is: "Flash Crash" arrest lays bare regulatory lapses at all levels. Goldman Sachs makes $20m investment in HFT tech provider. Russell become the latest to unveil digital tools for advisors. SunGard to explore possible $10 billion sale says sources. The Inbox: Listener questions and comments Question from Charles S. - What software is the most popular these days with proprietary options trading shops? Is there one that dominates the landscape? Question from Adam - Hello, I am a big fan, thank you for your great shows. I have been looking for a platform that I use for Backtesting. I currently use thinkorswim but Backtesting is slow and not reliable. Any suggestions? Thanks, AdamVega Question from Nikolai - Why do you think so few outside investment funds and venture funds invest in trading-related startups?

Hot Topics in Tech: How did Bloomberg fix its terminal outage? Virtu or vice? Fund managers face dilemma over speed-trading IPO. Parasite turns on parasite: HFT sues other HFTs for "egregious manipulation" of treasury securities. DE Shaw, Citadel urge CFTC to allow anonymous swaps trades. The Inbox: Listener questions and comments Question from Andrew Hale - How about a segment where you guys review trading apps? I would certainly tune into that. Comment from Joe Riggs - Love the story about the armada of HFT battleships from the last episode. I have heard some crazy things about HFT over the past year, but this is definitely the craziest. Can you imagine all the big players launching ships to try to claim the waters near the midpoint of the exchanges? My mind keeps going back to the old Barbary pirates - this is the modern day version. I think international fleets would be assembled to disperse this modern day threat to market integrity. Amazing! Sounds like the starting point for a great novel. Trouble is no one would believe it.

CTO Interview: Today's guest is Vlad Karpel, Former CTO of OptionsXpress and Founder of TradeSpoon. He discusses: An overview of his background in the options market. TradeSpoon: what is it? What makes it unique? The TradeSpoon trade recommendation algorithm. Some of the offerings from TradeSpoon, including: Trade Idea Tool, Options Toolbox, Momentum Scanner, Unusual Options Scanner, Size Scanner, Total Value Scanner, and Tradespoon Scoop. Hot Topics in Tech: Not much love for financial firms in the survey of recent Engineering and CS graduates. Only three financial firms - Goldman, JP Morgan and Morgan Stanley in the top 50. Investment in financial technology groups triples to $12bn in year The Inbox: Listener questions and comments An overview of tools for technology analysis for retail customers

Hot Topics in Tech: OCC to consider tech overhaul. Virtu hopes time can heal HFT furor. Study by CFTC official questions legality of HFT practice. City of London "black book" is called for to track "bad apple" traders. Physicist says it is possible to use ships to facilitate high-frequency trading. The Inbox: Listener questions and comments Question from Anthony J. - Hello Mark and Henry. I very much enjoy the program and your insight into this marketplace. I have a question about options data. You have mentioned on other programs an explosion of data and messaging. People always talk about a ceiling for exchanges. But I have to wonder if we are approaching some sort of theoretical limit on how many options series can be listed. Every new issue has hundreds or even thousands of strikes with both calls and puts. That is a tremendous burden for any platform to update in a real time basis with every tick of the stock. At what point do traders simply throw up their hands and say "no mas." Comment from Mark Brant - Thanks Henry + Mark for info about "shows", and thank 4 the free flow data on TOI.com and The Top Ten from Trade Alert. Why would the Russians do something so stupid? Their economy is shot already, cyber terror would pulverize it! Question from Vargo - The derivatives markets pose a number of significant challenges from a technology standpoint. There has been a tremendous expenditure to create systems to model so many disparate classes and update them with every tick of the underlying. Have we we seen any spillover of this amazing technology to other industries or areas? Question from Shadowbox - Is it feasible to use GPS to increase the timing accuracy of data stored by firms and provided to regulators? Or is GPS not fast or accurate enough to meet the new 50ms standard proposed by Finra?

Hot Topics in Tech: Could Russia use high-frequency trading to crash the markets? NYSE rolls out auctions, and upgrades its technology guts. CFTC commissioner attacks swaps regulation and proposes alternative agenda. Watchdogs home in on financial technology. Casualties mount in high-speed trading arms race. Brokers, synchronize your watches - Regulators want the industry to improve their server-clock synchronizations so they can build the Consolidated Audit Trail.; The Inbox: Listener questions and comments Question from Cortez - I like the discussion about Fintech UX on the last show. What would you say is the greatest UX crime committed by Fintech companies? Question from Orgo Tea - At what point does the number of listed options exchanges simply become too much of a burden for customers and clients to endure? Reply from Mark Brandt (in reply to "Please explain how options block trades are executed and how to transition to block trading from retail work. Thx!") - Thanks for the great answer about block trading, but by "work" I meant my efforts to get block trades, not a job!

CTO Interview: Today's guest is Joseph Wesley, Founder & CEO of Vesel Interactive. He discusses: An overview of his background in the derivatives market? What is Vesel? Who is Vesel's end user? How many firms are using the Vesel system right now? How does Vesel generate your derivatives volume reports? Why do firms share their data with Vesel? What safeguards are there against firms under/over-reporting their volume or marketshare? An overview of VolAxe? How easy is it for clients to build their own hook into the system using the API? How does this offering compare with what the guys at EQ derivatives are offering? Teases of upcoming Vesel developments Listener Mail: Listener questions and comments Question from Avalone - What is the take on coinbase. Seems to be making a lot of headlines. Exchange went live this morning. Any takers out there for these bitcoin things? Question from VTech - Are there specific GUI challenges for options front ends vs. equities? I know that options have more series than equites. Does that translate into any unique needs for those products vs. standard cash equities? I am studying UX at school with the hopes of breaking into the financial realm after graduation, perhaps on the derivatives software side. Question from Mark Brant - @Options Please explain how options block trades are executed and how to transition to block trading from retail work. Thanks!

Hot Topics in Tech: SEC plans to fix data release flaw in Q1 2015. SEC pokes hole in argument it is too slow to get grip on markets. Nobel laureate Stiglitz blocked from SEC panel after faulting high-speed traders. Finally progress on obvious error rules: BATS obvious error filing. Big fund managers form new dark pool equity trading venue. Cyber Security: JP Morgan and Target attack. CME Group fines three firms for automated trading violations. Dark Pools Detente: ICE has unlikely ally on trading proposal. The Inbox: Listener Questions and Comments Question from Andy Charles - You guys were pretty dismissive of Robin Hood on the last show. Do you feel that is because you are not really the target market - you are not 23 with $200 to your name? Are you giving it a fair shake? Question from Tim C - NYSE invests $75M in Coinbase. Nadex lists Bitcoin binaries. Tera Exchange lists Bitcoin derivatives. Is it time to accept that Bitcoin is here to stay?