Tue, Oct 6, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Eurex Exchange outlines the challenges and opportunities of high-frequency trading

Tuesday, May 07, 2013

Beverly Chandler, Opalesque London: A recent presentation from Eurex Exchange entitled High-frequency trading – a discussion of relevant issues, the exchange explained the difference between algorithmic trading (AT) and high frequency trading (HFT).

Common factors between the two include pre-designed trading decisions, that both are used by professional traders who are observing market data in real-time and they use automated order submission and automated order management. Other common factors are that there is no human intervention and they access the market directly.

However, peculiar to AT is the fact that it is primarily agent trading, minimizing market impacts (for large orders) and these traders hold significant positions overnight and typically even for days, weeks or months, working an order through time and across markets.

By contrast, Eurex assesses the characteristics of HFT as

  • Proprietary trading
  • High number of orders, rapid order cancellation
  • Mainly spread and arbitrage income
  • No significant position at the end of a day (flat position)
  • Short holding periods, small margin per trade
  • Low latency requirement
  • Focus on highly liquid instruments
Eurex explains that it is difficult to make a conclusive definition of HFT, as it can be applied to a broad spectrum of strategie......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Performance - Hedge fund moguls Einhorn, Loeb, Rosenstein lose money in September, Risky strategy sinks small hedge fund[more]

    Hedge fund moguls Einhorn, Loeb, Rosenstein lose money in September From Reuters.com: Billionaire stock pickers David Einhorn, Daniel Loeb and Barry Rosenstein on Wednesday told their wealthy investors they lost money in September as market turmoil inflicted more pain on some of America'

  2. Opalesque Exclusive: IRAs represent billions of untapped capital for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva: Retirement accounts might not be the first source that comes to mind for those looking to raise funds, but they may represent billions of untapped capital. Unlike traditional retirement accounts,

  3. Opalesque TV: One way to access market hedge funds in the EU under the AIFMD radar[more]

    Benedicte Gravrand, Opalesque Geneva: While the Cayman Islands, the US and Hong Kong await the pan-European marketing passport to be extended to alternative investment fund

  4. U.S. hedge funds prepare for worst finish this year since 2008[more]

    Komfie Manalo, Opalesque Asia: U.S.-focused hedge funds are preparing for their worst year since the 2008 global financial crisis, following a series of letdown including the market sell-off in August and the sell-off in healthcare and biotechnology sectors last month, reported

  5. Vilas’ equity long bias hedge fund generates market-beating results[more]

    Komfie Manalo, Opalesque Asia: The Vilas Fund, an equity long bias fund managed by Chicago, Illinois-based Vilas Capital Management, posted five-year annualized returns, net of fees, of 23.47% vs. 15.87% for the S&P 500 Index, including divid