Other Sellers on Amazon
Download the free Kindle app and start reading Kindle books instantly on your smartphone, tablet, or computer - no Kindle device required. Learn more
Read instantly on your browser with Kindle Cloud Reader.
Using your mobile phone camera - scan the code below and download the Kindle app.
Enter your mobile phone or email address
By pressing "Send link," you agree to Amazon's Conditions of Use.
You consent to receive an automated text message from or on behalf of Amazon about the Kindle App at your mobile number above. Consent is not a condition of any purchase. Message & data rates may apply.
Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market Paperback – June 25, 2013
Enhance your purchase
In the beginning was Josh Levine, an idealistic programming genius who dreamed of wresting control of the market from the big exchanges that, again and again, gave the giant institutions an advantage over the little guy. Levine created a computerized trading hub named Island where small traders swapped stocks, and over time his invention morphed into a global electronic stock market that sent trillions in capital through a vast jungle of fiber-optic cables.
By then, the market that Levine had sought to fix had turned upside down, birthing secretive exchanges called dark pools and a new species of trading machines that could think, and that seemed, ominously, to be slipping the control of their human masters.
Dark Pools is the fascinating story of how global markets have been hijacked by trading robots--many so self-directed that humans can't predict what they'll do next.
Frequently bought together
"Far more comprehensive and persuasive [than even Michael Lewis' Flashboys]."
--James Stewart, New York Times Book Review
"An excellent history of the early electronic traders" - Michael Lewis
“Scott Patterson’s Dark Pools is about the most important financial issue no one talks about—how high-frequency traders have rigged the market.”
“Remarkable…even long-time participants in electronic markets will learn a lot from this book.”
“Richly reported…an invaluable piece of timely journalism that should be read by regulators and anyone with a cent in the stock market...You will never look at the opening bell in the same way.”
“An engaging narrative…DARK POOLS is easily the most entertaining and accessible book to cover the new world of stock trading.”
“An education in how markets work, packaged in a thriller worthy of Michael Crichton…. Dark Pools is one of those rare books that is a great summer beach read and a useful trading manual.”
“Very enjoyable….a good story of how innovators destroy the old guard.”
“Dark Pools relays an epic tangle of hacktivists, old-school floor exchanges and traders – all wrestling to game the machines…The stories engage from chapter to chapter, bringing the reader from the outside in.”
“An entertaining account of the key battles in the “algo wars” and the colorful math geeks who fight them—some of whom are now fighting to rein in the monsters they created. Dark Pools is an alarming account.”
“Dark Pools is a must read for all serious investors. Patterson’s methodically researched book exposes the core problems in today’s securities market…His findings should serve as a blueprint for the SEC.”
--Blair Hull, founder of Hull Trading and Ketchum Trading
About the Author
- Publisher : Currency; Reprint edition (June 25, 2013)
- Language : English
- Paperback : 384 pages
- ISBN-10 : 0307887189
- ISBN-13 : 978-0307887184
- Item Weight : 10.6 ounces
- Dimensions : 5.2 x 0.8 x 8 inches
- Best Sellers Rank: #100,915 in Books (See Top 100 in Books)
- Customer Reviews:
About the author
Reviews with images
Top reviews from the United States
There was a problem filtering reviews right now. Please try again later.
This book is a 'must read'. Not only does it give a great summary on how the stock market became computerized (as other reviewers mention), but it really helped me understand how the modern market came to be.
My goal in reading the book was to up my trading game, and while the book gives few trading ideas, it does a great job explaining how 'big money' and the HFTs game (cheat? trade?) the market. Understanding this alone really helps me understand price action at a whole new level.
I did have to remove one star though for the authors lack of understanding of computer algorithms and how they work. He uses "AI" as a catch-all phrase for any computer algorithm, even if it was a crude program that simply trades a stock spread.
The author does a very good job of mixing journalism with the kind of storytelling that is so common in the Financial Press. There are many references to companies and individuals who have contributed or influenced this industry. Unfortunately the author does not cite or reference papers (only three were mentioned) for the readers who want to probe into the more technical aspects of the developments covered in the book.
The "who" are highly intelligent people, technologists, programmers, physicists, statisticians... and less of the greed driven financiers that you might expect.... although there are plenty mixed in, The "what" is algorithms, computer programs, proximity to trading centers, and information churning through these programs discerning market moves in pico-seconds. The why -- especially at the beginning is less about making money and more about young technologists wanting to snub the establishment of Wall Street, open up markets for everyone, and making the whole process more efficient by essentially removing persons from the transaction.
Of course, all of this leads up to the last couple of years where the SEC is a slow moving entity imposing regulations that seem quaint compared to the speed at which the HF traders adapt and evolve. It is pitting a human against a computer in an algo war that is already rigged for the computer to triumph. Or maybe like the designer drug maker that is always one molecule ahead of the law that keeps the new drug from being illegal.
Dark Pools was a great read and an excellent book to read after Flash Boys!
Wall Street: The place where our 401ks and pension funds go, which we should all probably understand better than we actually do. Despite what could be called, at best, amateur interests in the world of trading, I couldn't put this book down. While by no means a deep technical work, Dark Pools still proved highly educational, offering a lot of insight into the inner workings of today's stock market. Fortunately, Patterson presents the material in a way that's eminently accessible, even for those without a Wall Street Journal subscription. Discovering not just how the market is, but how it came into its current form, was eye opening.
Dark Pools isn't just about the markets, however. It's also a testament to the raw power of computing and its ability to change the way we work in just a few years time. I expected the book to cover some hyper-modern trends like high frequency trading. What I didn't anticipate was a beautiful and inspirational story about a few gifted individuals employing computers to revolutionize the world of finance. As it turns out, one 20-something young man working out of a tiny office near Wall Street actually built large portions of the high tech stock market we see around us today. Ever the idealist, he sought to beat the hordes of greedy and self-serving market makers at their own game, using little more than a closet full of computers and his brain. And in many ways, he succeeded. But the story doesn't end there; this new technology would eventually take on a life of its own, growing and evolving at fantastic pace. Millions and billions would be made and lost in seconds. And it's still going on, all around us. Some say it's out of control.
I thoroughly recommend Dark Pools to anyone with even a passing interest in the stock market or the development of technology. It's an eye-opener on the state of our national finances on one hand, and a testament to the power of man and machine on the other.
Top reviews from other countries
It begins with smaller traders spotting a technological edge - trading directly electronically. Levine is the technical genius for one of the firms. It then digresses onto Artificial Intelligence and Genetic algorithms used to develop better trading strategies than humans can develop unaided.
It generally good journalistically and makes for an exciting read but fails to give much of a technical explanation of why The Island system was better than others - why was its availability better? Scott Patterson isn't technical.
The book would benefit from someone that understood both the technology and the markets.
Nevertheless a good history of the origins of High Frequency trading, worth a read.