Automated Market Makers
Robin Hanson has published a lot about automated market makers. A layperson's treatment can be found here, which, though apparently broken and full of transcription typos, gives us a clue as to one technique which could work. We've attached a few demos in Python below.
Robin Hanson has a more correct version of the article above here. It contains a couple of critical fixes to the algorithms.
Another place to look is Chris Hibbert's MarketMaker.java implementation in Zocalo: http://cvs.sourceforge.net/viewcvs.py/zocalo/devel/src/net/commerce/zocalo/MarketMaker.java?rev=1.1.1.1&view=markup
Attachments
- auto-market-maker.py (2.1 kB) -
a partial attempt at implementing one of Robin's market makers
, added by stevegt@terraluna.org on 03/08/06 21:52:53. - auto-market-maker.2.py (2.9 kB) - added by dmasten@piratelabs.org on 03/18/06 07:49:02.
- auto-market-maker-3.py (4.4 kB) -
adds dynamic Q and j delta to limit loss
, added by stevegt@terraluna.org on 03/20/06 06:27:08.
