The story of Navinder Singh Sarao is one of most remarkable stories to come out of Financial markets in recent years. Sarao, a day trader, working mostly from his bedroom in his parents ordinary semi-detached house in an average suburb of West London, managed to amass a $70,000,000 fortune whilst at the same time being accused of bringing global stock markets to it knees.
Our guest this week is Liam Vaughan, Bloomberg journalist and author of the brilliant new book ‘Flash Crash: A Trading Savant, a Global Manhunt and the Most Mysterious Market Crash in History.’
Vaughan’s book tells the incredible story of Navinder Singh Sarao and the 2010 Flash-crash.
In this modern Robin Hood tale, Vaughan tells how Sarao managed to become one of world’s top 5 trading participants by volume in the e-mini S&P futures globally. This futures contract is one of the world’s largest and most actively traded contracts, with other participants in this market include major investment banks, international investment firms and global hedge funds.
Vaughan, who also wrote the book ’The Fix’, about the LIBOR scandal is a master story teller. In this interview, Steven Goldstein and Mark Randall, both market veterans, and former participants in the futures market, discuss with Liam in an open and frank manner a wide range of themes and topics about this incredible story including:
Did Sarao’s obsession growing up playing computer games may have come to be a major advantage to his screen-based trading activities.
The paradoxes in Sarao’s character traits and how these supported his success as a trader but at the same time left him vulnerable in other areas of his life.
How Navinder’s gifts and mental attributes, seen by some as learning difficulties, probably worked in his favour in his trading activities.
How Navinder’s mindset and very different relationship with money may have contributed to his fearlessness and his trading style.
Having a grudging admiration for what Sarao achieved
How the laws changed after Sarao commenced his spoofing activities and after the Flashcrash.
How Navinder’s activity exposed the frailties within the Electronic Futures Trading system and how new platforms increasingly developed the ability to manipulate markets.
How Navinder had felt the market was rigged against him by other people who had unfair advantages, including other spoofers and HFT traders.
Debating whether his activities followed the failure of the authorities to act on his complaints about the activities of others, and whether by ignoring the authorities effectively green-lighted his activities.
The huge gulf which exists between the resources and level of expertise in those regulating and policing trading activities and those of the firms and people engaging in activities in markets.
The importance of balance between your trading activities, and the other parts of your life.
Whether Navinder was ultimately a victim in this story.
You can find our more about Liam on his website https://liamvaughan.co.uk/ and can order the book direct form there. - The book was released in May this year in Hardback, Audible or Kindle form iand s called Flash Crash: A Trading Savant, a Global Manhunt and the Most Mysterious Market Crash in History.
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