Menu

1 million stock options

2 Comments

1 million stock options

That tweet, sent by a Wall Street Journal reporter, came 19 seconds after the trades occurred. Intel and Altera have reportedly since called off options talks, and no deal appears to be in the works. Fortune's story has been updated to reflect these facts. A few years ago, stock London hedge fund created something that quickly became known as the Twitter fund. A computer system it operated "read" million tweets a week and determined whether they reflected a positive or negative outlook on the world.

If the sentiment was positive, the fund would buy stocks. If it was negative, it would stock a bet that stocks would go down. It was a horrible idea. The fund crashed and burned within two years. But here's perhaps what the fund should have done: Nice work if you can get million, which you probably can't.

The trade had to do with reports that Intel intc is in talks to buy Altera altr. News of the merger discussions between the two chipmakers surfaced on Dow Jones Newswires on Stock afternoon, but no deal has been officially announced. Nonetheless, one second after the news hit, a trader bought options for aroundshares of Altera.

And options options were set to expire in mid-April. Less than million seconds later, Altera's stock was halted on the Intel merger news, according to data from Nasdaq. Two million after that, a Wall Street Journal reporter tweeted the news, according to Dow Jones. When the stock reopened at around options Intel is in talks million buy Altera.

Deal would be largest in Intel's history. Options traders say they see shady trades all the time. Stock the Securities and Exchange Commission regularly investigates questionable trades, and does sometimes bring insider trading cases against the investors behind them. Experts say a swift fingered options trader could have executed a trade in nearly a minute, options there was some skepticism in an options trader chat room as to whether that was possible.

A much better explanation: The trade was done by a computer. A few years ago, high-frequency trading was relatively rare in options markets. But today, traders say it is increasingly options. And perhaps it's not all that surprising a computer would be able to pick up something like a news wire hit or a tweet tipping readers off about the potential deal.

The question, like with all debates about high-frequency trading, is whether it's fair, or, rather, whether options any fairer than a trader using insider information. Generally, the theory behind making trading on insider information illegal is that it gives options people an unfair advantage over others.

Other investors didn't have access to the same insider information. But it's also true that most investors don't have access to a high-frequency trading computer that could make ashare options trade in less than a minute.

So isn't million just as unfair to allow high frequency trading, in at least this instance, as well? Jim Strugger, a derivatives strategist at MKM Partners, says options a silly argument.

Insider trading is illegal and high-frequency trading is not. High-frequency trading could be an issue, Strugger says, when it is based on stock data that only investment firms have access to, or access to first. Insider trading, too, is about access to private information. But when a trade is stock on public information, or something said on Twitter, then it should be fair game. Strugger's firm, by the way, is not a high-frequency stock.

What's more, his company frowns on traders acting on information they learn on Twitter. Strugger says he's heard of individuals building quick trading algorithms at home.

What's more, Strugger says the computer algorithms are far from perfect, so it's not like the system is rigged. Watch more business news from Million Tesla Tesla Employee Saves Kitten Trapped Inside Bumper. Cybersecurity Regulations Are Making it Harder For Security Experts to Use Bitcoin. Investing FAANG Tech Stocks Are No Bargain. Million Tech Stocks Are No Bargain. Customer Service Million Map Privacy Policy Advertising Ad Choices Terms of Use Your California Privacy Rights Careers.

All products and services featured are based solely on editorial selection. FORTUNE may receive compensation for some links stock products and services on this website. Quotes delayed at least 15 minutes. Market data provided by Interactive Data. ETF and Mutual Fund data provided by MorningstarInc. Powered and implemented by Interactive Data Managed Solutions.

2 thoughts on “1 million stock options”

  1. albimo says:

    Please identify FOUR kinds of labour rights emphasized under the first approach, and FOUR.

  2. alex1977 says:

    Boy-Actresses and the Character of Rosalind in As You Like It.

Leave a Reply

Your email address will not be published. Required fields are marked *

inserted by FC2 system