After being blamed for the flash crash of May 6, 2010, high frequency trading (HFT) took on a legendary status with the investing public. Some had found yet another reason why the little guy can’t get a break on Wall Street, while others saw another step in the evolution of trading.
Traders buy and sell for a variety of reasons. Some traders will make decisions based upon news headlines or gut feelings. One may read that gasoline prices are at record levels and decide they have to go down, while with equal certainty another trader decides the news justifies even higher prices. These strategies rely on luck, rather than mathematical probabilities, to succeed.
What to make of the current inflationary economic climate? To hear a government economist tell it, it’s basically “nothing to worry folks. Nothing to see here.”
Ray Dalio is the founder of Bridgewater Associates which manages over $150 billion in assets. Bridgewater Associates runs one of the largest hedge funds in the world, and their Pure Alpha fund has over $45 billion assets under management
In the early seventies, amidst political upheaval, inflationary pressures and stagnant economic growth, the richest family in America (at the time), the Hunt family of Texas, tried to corner the market on precious metals.