"Thanks for the inputs on high frequency trading - the Jeremy Grant article suggests to me that the HFT boys may be responsible for the convergence we have been able to observe since the 2009 bottom, where every so-called 'risk asset' has a similar shape chart pattern, only magnitude differing, and timing of course being similar and thus diversification almost impossible to achieve (except in , eg, currencies if you hold major pairs rather than betting one way...but clearly return suffers!) So this lemming-like energy expended in arbitrage for 10ths of a basis point makes it impossible for the rest of us to achieve rational strategies..."

David Fuller's view You make a very interesting point on convergence which has been more pronounced over the last year than anything that I can recall seeing before. Consequently it had also crossed my mind that another factor such as HFT might have been an influence but I have not previously mentioned this as it was conjecture on my part.

Whatever, there has been some clear uncoupling since the May 6th temporary meltdown on Wall Street and subsequent furore, due to suspicion that the event was caused by HFT, although this is still unproven to my knowledge. For evidence of this subsequent uncoupling, note the difference between the S&P 500 and Sensex indices since early May, or any other high-performing Fullermoney investment theme. I have often mentioned this uncoupling since May, especially in the Audios, but not in the context of HFT.

Therefore I remain optimistic that it is possible for us to perform with appropriate strategies. Even if HFT is distorting markets as some of us believe, it will not be all pervasive. A number of markets do not and almost certainly will not allow HFT, and I believe both the SEC and CBT are working on regulatory changes to rein in the practice. Our financial and commodity markets exist to serve the broader needs of our market economies, not predators with the fastest computers.