this post was submitted on 29 Dec 2024
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One of my college roommates is an algorithmic high frequency trader. It always reminded me slightly of a legal version of the Superman 3/Office Space scam. Basically trade so fast whenever your algorithm sees the line go up the right way that you harvest tiny amounts all day before the humans actually making financially relevant decisions make the market move in larger chunks for actual economic reasons.
It’s taking money while providing literally zero value to anyone else, even your fellow finance bros.
Don't you have to keep records of every transaction and report them to the IRS ?
The data of the buying/selling would be tracked by software via the stock broker, which would aggregate into a tax form via other software, and then be imported into their taxes by more software.
I think a 1099B at the end of the year coming from whatever company they are using would cover it.