RT Journal Article
SR Electronic
T1 High-Frequency Trading: <em>Implications for Markets,</em>
	       <br/>
	       <em>Regulators, and Efficiency</em>
JF The Journal of Trading
FD Institutional Investor Journals
SP 87
OP 97
DO 10.3905/jot.2011.6.1.087
VO 6
IS 1
A1 Jayaram Muthuswamy
A1 John Palmer
A1 Nivine Richie
A1 Robert Webb
YR 2010
UL https://pm-research.com/content/6/1/87.abstract
AB The sharp rise in high-frequency trading in recent years has caused average trade horizons to fall as traders attempt to exploit fleeting inconsistencies in prices with the aid of powerful computers and equally powerful algorithms. This practice is now poised to dominate the regular volume of order flow. More seriously, it brings into perspective issues such as induced excess volatility, whether the playing field is level for all market participants, and even the informational efficiency of security markets. In this article, the authors review what high-frequency trading is, and explore the links between such trading and market efficiency and volatility. Finally, they assess the potential for further trading practices to emerge, the likes of which most observers would not have imagined as feasible even 10 years ago.TOPICS: Big data/machine learning, exchanges/markets/clearinghouses