Staring into Oblivion: A Study of Automated Trading

• In Event: 571 - Section on Economic Sociology Roundtables (one-hour)
  In Refereed Roundtable: Table 12. Social Studies of Finance

Abstract

This paper will present results from my fieldwork of companies working in Algorithmic Trading and High-Frequency Trading. Very often their trading practices are defined as the automatization of trading and thus a replacement of humans through machines. Preliminary results from my fieldwork indicate that, far from side-lining humans, fully automatized trading, paradoxically, intensifies complex human-machine relations. “Collective hybrids” (Callon/Muniesa), under which automated trading may be classified, integrate humans and non-humans elements on a multi-frequential scale. After briefly describing the various human figures in automated financial markets – such as quantitative analysts – I will analyze their relations to the socio-material environment. After briefly surveying the entangling frequencies across human senses, material screen- and soundscapes, and algorithmic discrimination, I analyze what happens at the particular instances when these relations, for one reason or another, fail. At the example of the Flash Crash in 2010, I will show, ex negativo – by tracing what happens at the moment of their dissolution – that it is the highly intense relations among elements of such dynamic collectives that leave the disentangled elements in states of shock and affective arrest, drifting (algorithms) and traumatized (humans).

Author

• Robert Seyfert, Universität Konstanz