Mark Buchanan, Medium, Bio-finance? Why high-frequency trading makes stocks flock like birds, here.
Financial firms that specialize in “high-frequency” trading (HFT) are now buying and selling stocks, futures, foreign currencies and many other assets with computer algorithms operating on timescales less than 1 millisecond. That’s more than 1,000 trades a second. Modern markets have become complex ecologies in which millions of these “algos” compete all the time, and with advancing technology, 10,000 trades per second is just around the corner. More than half of all trading now takes place this way, and there’s no end in sight to this “arms race” to ever faster speeds.
Austin Gerig, High-Frequency Trading, here.