Are Speed Traders the Most Responsible and Risk-Averse Players in the Market

New York, NY -- (SBWire) -- 10/28/2011 --For Manoj Narang, Chief Executive Officer of Tradeworx, one glaring misconception is that high-frequency trading generates massive profits for Wall Street. First of all, he says, Wall Street has very little to do with high-frequency trading, and second, the profits are actually very modest. He adds: "People have the misconception that high-frequency trading practitioners have a kind of ‘cowboy mentality’ and that the markets are like the Wild West as a result. Nothing could be further from the truth. High-frequency traders are among the most responsible and risk-averse players in the market. They have never been implicated in any sort of wild risk-taking behavior, which is quite a contrast from the Wall Street traders who nearly brought the global economy to total collapse in 2008."

Mr. Narang, one of the leading high-frequency traders featured in Edgar Perez's The Speed Traders: An Insider's Look at the New High-Frequency Trading Phenomenon That is Transforming the Investing World (http://www.thespeedtraders.com), founded Tradeworx in 1999 with the goal to democratize the role of advanced technology in the financial markets. Tradeworx also operates a quantitative hedge fund business that currently manages hundreds of millions of dollars in assets, as well as an in-house proprietary trading business focused on high-frequency trading strategies. Tradeworx trades U.S. equities and will eventually expand to all other electronic markets. As most high-frequency trading firms, Tradeworx doesn’t accept external capital, because the capital requirements are very low. The main use of outside capital in the world of high-frequency trading is to fund R&D and operations, not to actually trade the capital.

Mr. Narang finally adds: "High-frequency trading provides a valuable service to the market, and earns a relatively tiny profit in return. Let’s consider this, when an individual investor executes a 200-share order in their online brokerage account, the investor pays a broker five cents per share to execute the trade. The broker does not risk any of its own capital to do this; all he does is route the order to the exchange or to a market-maker. The player on the other end who actually provides a fill for the trade is a high-frequency trader. The high-frequency trader not only risks his own capital to provide the required liquidity, but in exchange, only receives about 1/50th of the compensation that the broker, who takes no risk whatsoever, makes on the very same trade. If people have a grievance with the financial establishment, they should ask their broker why they need to earn fifty times the amount that the liquidity provider earns, despite the fact that they are not even risking any capital on the trade!"

The Speed Traders, http://www.TheSpeedTraders.com, published by McGraw-Hill Inc., is the most comprehensive, revealing work available on the most important development in trading in generations. High-frequency trading will no doubt play an ever larger role as computer technology advances and the global exchanges embrace fast electronic access. The Speed Traders explains everything there is to know about how today's high-frequency traders make millions—one cent at a time.”

Mr. Perez is widely regarded as the pre-eminent networker in the specialized area of high-frequency trading. He has been featured on CNBC Cash Flow with Oriel Morrison (http://video.cnbc.com/gallery/?video=2023403523), BNN Business Day with Kim Parlee (http://watch.bnn.ca/business-day/august-2011/business-day-august-19-2011/#clip519647), TheStreet.com with Gregg Greenberg (http://www.thestreet.com/video/11144274/high-frequency-traders-not-the-enemy.html), Channel NewsAsia Cent & Sensibilities with Lin Xue Ling, The Wall Street Journal, The New York Times, The Dallas Morning News, Los Angeles Times, iMoney Hong Kong, Hedge Fund Brief, Oriental Daily News Hong Kong, and more. He has been engaged as speaker at Harvard Business School’s 17th Annual Venture Capital & Private Equity Conference, High-Frequency Trading Leaders Forum 2011 (New York, Chicago, Hong Kong, Sao Paulo, Singapore), CFA Singapore, Hong Kong Securities Institute, Courant Institute of Mathematical Sciences at New York University (New York), Global Growth Markets Forum (London), Technical Analysis Society (Singapore), Middle East Hedge Funds Investors Summit 2012 (Riyadh, Saudi Arabia), among other global forums.

Mr. Perez was a vice president at Citigroup, a senior consultant at IBM, and a consultant at McKinsey & Co. in New York City. Mr. Perez has an undergraduate degree from Universidad Nacional de Ingeniería, Lima, Peru (1994), a Master of Administration from Universidad ESAN, Lima, Peru (1997) and a Master of Business Administration from Columbia Business School, with a dual major in Finance and Management (2002). He belongs to the Beta Gamma Sigma honor society. Mr. Perez resides in the New York City area and is an accomplished salsa and hustle dancer.

Mr. Perez is one of the great business networkers and motivators on the lecture circuit; he is available worldwide for the following speaking engagements: Present and Future of High-Frequency Trading, The Real Story behind the "Flash Crash", Networking for Financial Executives, and Business Networking for Success.