Gasp0deTreason in the Futures Markets
https://paulkrugman.substack.com/p/treason-in-the-futures-markets
So, who is paying the bill here? I am assuming the insider trading itself is zero-sum (its obviously different if what's happing happens only to allow insider trading) and while some (like passive investors like me that buy every month) win a bit, others lose a bit, someone loses big on the futures market. Is that the high frequency and quant traders? Because I assume, someone must be really mad? Especially since, and I again 'assume', that there must be easier and less public ways to bribe the admin
The losses would be diffuse. In the commodities markets you have a blend of speculative action and real economic activity. The blend is different based on the contract as well. The emini futures are pure financial engineering so it’s harder to track directly to the underlying economic activity.
Wti is much easier. Lots of real economic actors that produce or consume oil are active in those markets.
It's you. Every trader who does not have the insider information loses. That's how markets work after all. They collect information by rewarding the use of information. Anyone who has information and uses it is rewarded and anyone who does not is punished.
Even when you are a passive investor you lose. You essentially buy shares at random points in time. When that point happens to fall between the trading of an insider and the public disclosure of the insider information you will get a worse price for that trade.
It isn't even relevant whether the insider buys stocks or other securities directly or trades in futures instead. All information you enter into the market through trades permeates the whole market through arbitrage regardless of where you enter that information.