Readings: Hedge fund secrets, Turquoise trading platform, Futures ban
- Portfolio: Cudgel Over the Quants
Several months after he resigned, Falkenstein’s former employer, Telluride Asset Management in Minneapolis, sued him for stealing the firm’s trade secrets and violating its confidentiality agreement. Falkenstein had created trading algorithms for Telluride during his two and a half years on the job there, and the firm believed he was planning to use the same techniques to trade stocks for a fund he wanted to establish.
Trade-secret suits are difficult to follow in the public domain by their very nature: They’re based on secrets. Add to that the complexity of hedge fund trading algorithms, and you have all the necessary ingredients for an endless legal battle.
Right now, Telluride is examining 10 years’ worth of data from hard drives on Falkenstein’s personal computers for evidence of stolen trade secrets. “There’s nothing like a bunch of lawyers trying to figure out mean-variance optimization,” he says.
Heh.
Our nine founding members, BNP Paribas, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, Merrill Lynch, Morgan Stanley, Société Généralé and UBS have invested in Turquoise to give traders freedom to choose among liquidity venues.
Designed to compete with incumbent exchanges and alternative venues, Turquoise will differentiate on technology, costs and the quality of its services.
Turquoise’s sophisticated trading system combines rich functionality with high performance. Its unique market model integrates a dark pool and visible order book, taking advantage of crossing opportunities between the two. With Turquoise, users can expect frequent price improvement for small orders and can trade large orders efficiently while minimising information leakage.
“If rightly or wrongly people perceive that commodities- futures trading is contributing to a speculation-driven rise in prices, then in a democracy you will have to heed that voice,”
The government halted futures trading in wheat and rice last year and lentils in 2006 to check a surge in domestic prices of the commodities. “The pressure is to suspend a few more food articles,” Chidambaram said without identified the products.
Domestic traders and producing and consuming companies are the main participants in India’s commodity exchanges, compared with the 13 million individuals who invest in stocks. Overseas funds aren’t allowed to trade in India’s commodity futures.
PC: WTF?!
