Summary of Scott Patterson's Dark Pools

By IRB Media

Please note: This is a companion version & not the original book. Book Preview:

#1 Bodek, the founder of Trading Machines, was a wizard of data. He had made a career of crunching masses of numbers and finding form inside chaos. To discover order in the ocean of information that made up the market, he required incredible computer power.

#2 Bodek was a legendary talker. He had risen to the top of the trading world, working first at an elite Chicago firm called Hull Trading, then inside a top secret quantitative derivatives operation at Goldman Sachs. In 2007, he broke out on his own and launched Trading Machines.

#3 Bodek’s team was getting poached by competitors, and he was doing all the work of three employees to keep the ship afloat. He couldn’t do much more, and he needed everyone to pitch in if the firm was going to right itself.

#4 Bodek’s Trading Machines was having a nightmare in 2009. Its profits were dropping sharply. Bodek began to track the Spyder, one of his favorite ETFs, and saw it begin to move downward.

• Language: English
• Publisher: IRB Media
• Release date: Jun 3, 2022
• ISBN: 9798822529687

IRB Media

With IRB books, you can get the key takeaways and analysis of a book in 15 minutes. We read every chapter, identify the key takeaways and analyze them for your convenience.

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Insights on Scott Patterson's Dark Pools

Contents

Insights from Chapter 1

Insights from Chapter 2

Insights from Chapter 3

Insights from Chapter 4

Insights from Chapter 1

#1

Bodek, the founder of Trading Machines, was a wizard of data. He had made a career of crunching masses of numbers and finding form inside chaos. To discover order in the ocean of information that made up the market, he required incredible computer power.

#2

Bodek was a legendary talker. He had risen to the top of the trading world, working first at an elite Chicago firm called Hull Trading, then inside a top secret quantitative derivatives operation at Goldman Sachs. In 2007, he broke out on his own and launched Trading Machines.

#3

Bodek’s team was getting poached by competitors, and he was doing all the work of three employees to keep the ship afloat. He couldn’t do much more, and he needed everyone to pitch in if the firm was going to right itself.

#4

Bodek’s Trading Machines was having a nightmare in 2009. Its profits were dropping sharply. Bodek began to track the Spyder, one of his favorite ETFs, and saw it begin to move downward.

#5

The Machine was beginning to trade stocks and ETFs to hedge its risks. It had begun by buying an option on the Spyder that was equivalent to being short $1. 4 million worth of the ETF.

#6

Bodek’s team was having a difficult time trading the Spyders. The market kept going up, and the team was losing money.

#7

In the late 1980s and early 1990s, computer power was not available to anyone outside corporate giants such as IBM and the military-industrial complex. The Internet was in its infancy, and there was no Google, no Wikipedia, no Twitter.

#8

Bodek was able to predict the future by studying artificial intelligence. He began working for Magnify, a high-tech firm run by Robert Grossman, a pioneer in techniques to mine giant databases for information. He quickly proved his mettle there.

#9

Bodek was hired by Hull Trading in September 1997. He was assigned to use machine learning to predict the direction of the stock-option market. It was the beginning of a dramatic trading evolution on Wall Street and among the first salvos in the coming Algo Wars.

#10

At Goldman Sachs, Bodek became a cog in the market’s rapidly evolving machinery. The system was becoming increasingly electronic, driven by powerful