Podcast Review: How Electronic Stock Trading Came To Be

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Original Podcast by Planet Money (NPR) “#396: A Father Of High-Speed Trading Thinks We Should Slow Down“.

This podcast was a great listen. The gentleman that NP discusses in this podcast, Thomas Peterffy, is one of the richest men in the world and he made the first portion of his wealth by option trading.

Back in the day before computers were heavily utilized, stock options were essentially guesses created by large players and traders in the market. If people felt that flour option prices were low, then they were. Peterffy used this to his advantage by using algorithms to calculate what the price should have been and then used technology to his advantage. After some serious hardware modifications, he was able to network a computer into a NASDAQ terminal and the rest is history.

But really, a neat story if you have 22 minutes to spare.

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