Optimal Account Balancing

stochastix.wordpress.com

35 points·TriinT··5 comments

Free book on directed graphs:

http://www.cs.rhul.ac.uk/books/dbook/

Very, very simplistic. Much more applicable to TCP network throughput, travelling salespeople than financial transactions

Missing ::

* Real World Transaction costs [ state, federal, international tax . Exchange volume discounts ]

* Risk [ counterparty , timing, many more ]

* Traceability : Ensuring decisions made are recorded and deterministic

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See After the Trade is Made for an accepted analysis of distributing securities.

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http://www.amazon.com/After-Trade-Made-Processing-Transactio...

In case you didn't notice, the blog post is on how a group of friends can split the bill in an efficient manner. It has little to do with securities. Of course, if it had to do with securities, then your points would be right on target.

Thanks for the book suggestion, btw. It seems a good complement to Larry Harris' Trading & Exchanges :-)

Nice. Also shows very well why it would be useful to trade things like credit default swaps on exchanges instead of OTC.

"Over-the-counter (OTC) trading is to trade financial instruments such as stocks, bonds, commodities or derivatives directly between two parties." -- http://en.wikipedia.org/wiki/Over-the-counter_(finance)

I had to look it up so I noted it here for anyone else that would need to do the same.

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