{"id":32745,"date":"2018-06-10T08:10:42","date_gmt":"2018-06-10T12:10:42","guid":{"rendered":"https:\/\/swling.com\/blog\/?p=32745"},"modified":"2018-06-10T08:10:42","modified_gmt":"2018-06-10T12:10:42","slug":"shortwave-trading-part-ii","status":"publish","type":"post","link":"https:\/\/swling.com\/blog\/2018\/06\/shortwave-trading-part-ii\/","title":{"rendered":"Shortwave Trading Part II"},"content":{"rendered":"<p><a href=\"https:\/\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-22683\" src=\"https:\/\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg\" alt=\"\" width=\"640\" height=\"245\" srcset=\"https:\/\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg 640w, https:\/\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR-300x115.jpg 300w, https:\/\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR-624x239.jpg 624w\" sizes=\"auto, (max-width: 640px) 100vw, 640px\" \/><\/a><\/p>\n<p>Last month, <a href=\"https:\/\/swling.com\/blog\/2018\/05\/mystery-traders-using-shortwave-to-cross-oceans-with-less-latency-than-any-fiber\/\">we posted a link to an article<\/a> that explained why traders might use shortwave radio for high-speed, faster-than-optical-fiber communications. The article by Bob Van Valzah originally appeared on the blog,\u00a0<a href=\"https:\/\/sniperinmahwah.wordpress.com\/2018\/05\/07\/shortwave-trading-part-i-the-west-chicago-tower-mystery\/\" target=\"_blank\" rel=\"noopener\">Sniper in Mahwah &amp; Friends<\/a>\u00a0where they&#8217;ve just posted part two in the series:<\/p>\n<blockquote><p>I have previously claimed that trading over shortwave radio is real and presented the story of the first evidence I found of it. It was pleasantly surprising to see the story picked up by IEEE Spectrum, Hacker News, Hackaday, and others. But since I hadn\u2019t anticipated such a diverse audience, I didn\u2019t provide details needed to understand shortwave trading in context so a lot of questions were raised. I\u2019ll provide some background here, answer the questions, and also document two other shortwave trading sites I\u2019ve found around Chicago. Traders can skip ahead while I fill in the broader audience.<\/p>\n<h4>Why is there a latency race? Isn\u2019t it just a waste of money?<\/h4>\n<p>Electronic trading technologist just take the latency race for granted, but it\u2019s important to think about why it exists and what it means to the average person. When you want to fill your car with gasoline, you have the choice of going to the nearby gas station and accepting their price or perhaps comparing prices at stations a little farther away. We would all spend a lot more time comparison shopping if we didn\u2019t have pretty good confidence that the prices at our local stations were competitive. But what keeps those prices competitive?<\/p>\n<p>The analogy between your local gas station and electronic markets is admittedly imperfect, but I think it is helpful in understanding why latency matters and how you benefit. Nobody can buy a tanker of gasoline in New York and immediately sell it in Chicago. The laws of physics prevent us from economically moving such a heavy load over a long distance quickly. But a share of Apple stock weighs nothing. The Chicago price and the New York price can be compared and changed in an instant. Well, about 4 milliseconds is how long it takes for an updated price to make the trip. Prices can make about 250 one-way trips in a single second.<\/p>\n<p>So when buying or selling Apple shares, you don\u2019t have to shop around for the best price. Electronic trading companies have an incentive to build the fastest networks linking financial centers so that prices can move quickly between them. Buyers and sellers benefit because their local market has electronic traders who know the best prices on other markets and will be happy to do a local deal at the best global price (it\u2019s market making). It doesn\u2019t take a rocket surgeon to see the business opportunity in this type of trading, so high-speed\u00a0traders have to be efficient because they\u2019re competing against each other. The latency race has to happen for each market to have the best price. Competition between electronic traders limits their spend to the benefits that come with better pricing.<\/p>\n<h4>Why does radio help win the latency race?<\/h4>\n<p>Traders use radio because it can move prices faster than optical fiber.<\/p>\n<p>I won\u2019t bore you with the physics, but I will remind you of this elementary school experiment where a pencil appears to bend in a glass of water. This happens because light moves more quickly through air than it does through water. In the same way, radio waves move more quickly through air than light can move through an optical fiber. In trading parlance, radio is lower latency than fiber over a given distance.<\/p>\n<p>But radio is also faster because it almost always covers a shorter distance. Fiber paths tend to follow roads and property lines that may not go exactly in the desired direction. Radio towers may be inconvenient, but they give the advantage that the signal can take the shortest-possible path allowed by physics, not the kinky path dictated by rights of way.[&#8230;]<\/p>\n<p style=\"text-align: center;\"><strong>Continue reading the full article on the blog,\u00a0<a href=\"https:\/\/sniperinmahwah.wordpress.com\/2018\/05\/07\/shortwave-trading-part-i-the-west-chicago-tower-mystery\/\" target=\"_blank\" rel=\"noopener\">Sniper in Mahwah &amp; Friends<\/a>.<\/strong><\/p>\n<\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>Last month, we posted a link to an article that explained why traders might use shortwave radio for high-speed, faster-than-optical-fiber communications. The article by Bob Van Valzah originally appeared on the blog,\u00a0Sniper in Mahwah &amp; Friends\u00a0where they&#8217;ve just posted part two in the series: I have previously claimed that trading over shortwave radio is real [&hellip;]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3,43],"tags":[34,7024,4655],"class_list":["post-32745","post","type-post","status-publish","format-standard","hentry","category-news","category-shortwave-radio","tag-shortwave","tag-shortwave-trading","tag-why-shortwave"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/pn3uc-8w9","jetpack-related-posts":[{"id":33193,"url":"https:\/\/swling.com\/blog\/2018\/07\/shortwave-trading-part-iii\/","url_meta":{"origin":32745,"position":0},"title":"Shortwave Trading Part III","author":"Thomas","date":"July 15, 2018","format":false,"excerpt":"(Source:\u00a0SNIPER IN MAHWAH & FRIENDS) I\u2019ve heard that years ago, there was a stable business selling microwave data radios to local governments for networking their offices. Then the traders discovered microwave and everything changed for the radio vendors. Their new customers weren\u2019t so much concerned about the cost\u2014they just wanted\u2026","rel":"","context":"In &quot;News&quot;","block_context":{"text":"News","link":"https:\/\/swling.com\/blog\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":62569,"url":"https:\/\/swling.com\/blog\/2025\/04\/radio-world-three-mysterious-new-shortwave-stations-approved-in-the-u-s\/","url_meta":{"origin":32745,"position":1},"title":"Radio World: Three Mysterious New Shortwave Stations Approved in the U.S.","author":"Thomas","date":"April 11, 2025","format":false,"excerpt":"From Radio World: In a rare move, the FCC has approved two new construction permits and granted a full license for international shortwave broadcasting\u2014prompting questions about their true purpose. All three applicants\u2014DPA Mac, Parable Broadcasting, and Turms Tech\u2014claim intentions to use the DRM standard, yet past filings and meeting summaries\u2026","rel":"","context":"In &quot;DRM&quot;","block_context":{"text":"DRM","link":"https:\/\/swling.com\/blog\/category\/drm\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2022\/11\/Black-and-White-Spectrum-Dark-1.jpeg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2022\/11\/Black-and-White-Spectrum-Dark-1.jpeg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2022\/11\/Black-and-White-Spectrum-Dark-1.jpeg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":31945,"url":"https:\/\/swling.com\/blog\/2018\/05\/mystery-traders-using-shortwave-to-cross-oceans-with-less-latency-than-any-fiber\/","url_meta":{"origin":32745,"position":2},"title":"Mystery: Traders using &#8220;shortwave to cross oceans with less latency than any fiber&#8221;","author":"Thomas","date":"May 9, 2018","format":false,"excerpt":"Many thanks to SWLing Post contributor,\u00a0London Shortwave,\u00a0who shares this fascinating article which takes a look at\u00a0high-frequency trading firms: (Source: Sniper in Mahwah & Friends) Shortwave Trading | Part I | the West Chicago Tower Mystery Since 2014 this blog has extensively covered the wireless networks built by high-frequency trading (HFT)\u2026","rel":"","context":"In &quot;News&quot;","block_context":{"text":"News","link":"https:\/\/swling.com\/blog\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":33217,"url":"https:\/\/swling.com\/blog\/2018\/07\/shortwave-trading-part-iv-final-post\/","url_meta":{"origin":32745,"position":3},"title":"Shortwave Trading Part IV (Final Post)","author":"Thomas","date":"July 16, 2018","format":false,"excerpt":"(Source:\u00a0SNIPER IN MAHWAH & FRIENDS) After my first few public posts about shortwave trading, I gradually realized that I\u2019d inadvertently created a worldwide network of deputy antenna sleuths. This is the final post in the Shortwave Trading series since the terms of my forthcoming employment agreement will prohibit me from\u2026","rel":"","context":"In &quot;News&quot;","block_context":{"text":"News","link":"https:\/\/swling.com\/blog\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2016\/12\/Spectrum-Waterfall-SDR.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":57216,"url":"https:\/\/swling.com\/blog\/2023\/07\/radio-waves-fcc-comments-on-shortwave-trading-qtc-ebook-golden-years-and-sdrconnect-demo\/","url_meta":{"origin":32745,"position":4},"title":"Radio Waves: FCC Comments on Shortwave Trading, QTC eBook, Golden Years, and SDRconnect Demo","author":"Thomas","date":"July 13, 2023","format":false,"excerpt":"Radio Waves:\u00a0 Stories Making Waves in the World of Radio Welcome to the\u00a0SWLing Post\u2019s Radio Waves, a collection of links to interesting stories making waves in the world of radio.\u00a0Enjoy! Many thanks to SWLing Post contributors Ron Chester, Benn Kobb, Chuck Rippel, Pietschman, Dennis Dura, and Dave Zantow for the\u2026","rel":"","context":"In &quot;News&quot;","block_context":{"text":"News","link":"https:\/\/swling.com\/blog\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/07\/Boat-Anchor-Dial-2-1024x678.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/07\/Boat-Anchor-Dial-2-1024x678.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/07\/Boat-Anchor-Dial-2-1024x678.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":34231,"url":"https:\/\/swling.com\/blog\/2018\/09\/cryptocurrency-transactions-over-solar-powered-shortwave-radios\/","url_meta":{"origin":32745,"position":5},"title":"Cryptocurrency transactions over solar-powered shortwave radios","author":"Thomas","date":"September 21, 2018","format":false,"excerpt":"(Source: The Next Web via Kim Elliott) Devs used solar-powered radios to complete first \u2018off-grid\u2019 cryptocurrency transaction Could blockchain help after disaster strikes? A group of developers claim to have performed a solar-powered cryptocurrency transaction, using shortwave radios and blockchain tech. While it might not be the world\u2019s first radio-transmitted\u2026","rel":"","context":"In &quot;News&quot;","block_context":{"text":"News","link":"https:\/\/swling.com\/blog\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/09\/blockchain-shortwave-crypto-currency-1024x768.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/09\/blockchain-shortwave-crypto-currency-1024x768.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/swling.com\/blog\/wp-content\/uploads\/2018\/09\/blockchain-shortwave-crypto-currency-1024x768.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]}],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/posts\/32745","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/comments?post=32745"}],"version-history":[{"count":0,"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/posts\/32745\/revisions"}],"wp:attachment":[{"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/media?parent=32745"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/categories?post=32745"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swling.com\/blog\/wp-json\/wp\/v2\/tags?post=32745"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}