FAQ On High Frequency Algorithmic Trading
FAQ ON HIGH FREQUENCY ALGORITHMIC TRADING (HFAT) IN FINANCIAL MARKETS Q1.Why must I know more about HFAT? Because if you don't, you will be ignoring a major revolution that is going on in the financial markets and affects whole economies as well as individuals like you. HFAT is growing rapidly in market volume share all over the world. In America it now accounts for > 53% of all trades, in Europe 28%, Asia 18%. By asset class it accounts for 65 % of equity trades, 50 % of f utures, 40 % of options, 25 % of forex and 20 % of fixed income instruments. Q2.What does Algorithmic mean.? Algorithmic simply means a set of instructions/rules. In our IT age it means having a software program that executes these instructions automatically. Algorithmc does not automatically equate with high frequency. Many fundamentals-based institutional traders also use algorithms merely to automate their trades. These could be stop-loss Algos, Algos that break up big blocks of buy/sell so that they won...