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The Persisting Human Element of the Electronic Trading Habit

Copyright © 2012. 14 pages.
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DOI: 10.4018/978-1-61350-162-7.ch011|
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MLA

van Daalen, Roger F.A. "The Persisting Human Element of the Electronic Trading Habit." Information Systems for Global Financial Markets: Emerging Developments and Effects. IGI Global, 2012. 271-284. Web. 23 Nov. 2014. doi:10.4018/978-1-61350-162-7.ch011

APA

van Daalen, R. F. (2012). The Persisting Human Element of the Electronic Trading Habit. In A. Yap (Ed.), Information Systems for Global Financial Markets: Emerging Developments and Effects (pp. 271-284). Hershey, PA: Business Science Reference. doi:10.4018/978-1-61350-162-7.ch011

Chicago

van Daalen, Roger F.A. "The Persisting Human Element of the Electronic Trading Habit." In Information Systems for Global Financial Markets: Emerging Developments and Effects, ed. Alexander Y. Yap, 271-284 (2012), accessed November 23, 2014. doi:10.4018/978-1-61350-162-7.ch011

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Abstract

The move towards electronic trading was believed by some to narrow the scope of information available to traders, due to the difference between the old paper-based and new IT-enhanced work environment. It was expected that a trader’s job performance would transform from a physical, social, embodied experience, into an individualized, rational, and detached operation. In this chapter, we discuss how the human element to trading has remained central to job performance, by illustrating how particular trading companies have excelled under the new job environment. Drawing on a data collected on electronic trading firms between mid-2007 to late 2010, we focus on a smaller set to illustrate our findings. We find that trading has remained a human endeavor; traders group together for learning and coordination benefits. Furthermore, firms now tap into a global talent pool, and have incorporated monitoring benefits made possible by electronic monitoring of positions for better risk management.
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Transitioning To Electronic Trading

It has been speculated that in paper trading, as opposed to electronic trading, that traders constitute the market by directly watching each other. In the physical paper trading setting, market participants emulate each others’ behaviours by observing trading habits of the successful traders, and similarly examined the failing strategies of others in order to exploit their weaknesses for profit (Zaloom, 2004). In this set-up, the trading pit is the material technology which through its shape becomes the focal point of trading, by directing traders’ information gathering, and price discovery. Because of the orderly and routinized way in which this set-up shapes trading in the pit, it was already considered a technology (Zaloom, 2003).

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Complete Chapter List

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Table of Contents
Preface
Alexander Y. Yap
Chapter 1
Donald Crooks, John Slayton, John Burbridge
Much has been written about information technology and its role in reinventing financial markets. Today’s markets are truly global, and the... Sample PDF
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Chapter 2
Alexander Y. Yap
Trading anytime anywhere ubiquitously is rapidly becoming a popular trading practice in the financial marketspace. When highly volatile financial... Sample PDF
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Chapter 3
Michael Kampouridis, Shu-Heng Chen, Edward Tsang
In a previous work, inspired by observations made in many agent-based financial models, we formulated and presented the Market Fraction Hypothesis... Sample PDF
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Chapter 4
Xiaotie Deng, Feng Wang, Keren Dong
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Chapter 5
Alexander Y. Yap, Wonhi Synn
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Chapter 6
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Chapter 7
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Chapter 8
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Chapter 9
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Chapter 10
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Chapter 11
Roger F.A. van Daalen
The move towards electronic trading was believed by some to narrow the scope of information available to traders, due to the difference between the... Sample PDF
The Persisting Human Element of the Electronic Trading Habit
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Chapter 12
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Chapter 13
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Chapter 14
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