High frequency trading: Difference between revisions

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(HFT.)
(HFT).


Trading activities using sophisticated technological tools and computer algorithms that generate a large number of daily trades at very fast speeds.  
Trading activities using sophisticated technological tools and computer algorithms that generate a large number of daily trades at very fast speeds.  


Typically at the end of the day there is no open position in the market.
Typically at the end of the day there is no open position in the market.


Characteristics attributed to HFT are:  
Characteristics attributed to HFT are:  


#extraordinarily high speed using sophisticated computer programs for generating, routing, and executing orders;
#Extraordinarily high speed using sophisticated computer programs for generating, routing, and executing orders;
#use of co-location services and individual data feeds offered by exchanges and others to minimize network and other types of time delays;  
#Use of co-location services and individual data feeds offered by exchanges and others to minimize network and other types of time delays;  
#very short time-frames for establishing and liquidating positions;  
#Very short time-frames for establishing and liquidating positions;  
#the submission of numerous orders that are cancelled shortly after submission;  
#The submission of numerous orders that are cancelled shortly after submission;  
#ending the trading day in as flat a position as possible.
#Ending the trading day in as flat a position as possible.




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* [[Algorithmic trading]]
* [[Algorithmic trading]]
* [[Computer based trading]]
* [[Computer based trading]]
* [[Day trading]]
* [[Investment horizon]]
[[Category:Identify_and_assess_risks]]
[[Category:Financial_products_and_markets]]
[[Category:Technology]]

Latest revision as of 14:18, 9 July 2022

(HFT).

Trading activities using sophisticated technological tools and computer algorithms that generate a large number of daily trades at very fast speeds.

Typically at the end of the day there is no open position in the market.


Characteristics attributed to HFT are:

  1. Extraordinarily high speed using sophisticated computer programs for generating, routing, and executing orders;
  2. Use of co-location services and individual data feeds offered by exchanges and others to minimize network and other types of time delays;
  3. Very short time-frames for establishing and liquidating positions;
  4. The submission of numerous orders that are cancelled shortly after submission;
  5. Ending the trading day in as flat a position as possible.


See also