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From Kirsten Bischoff, Opalesque New York:
Regulatory agencies may be leveling their sights on the high frequency trading space, but for many newly launching managers, the opportunity set far outweighs the possible future regulatory constraints. "We are seeing a lot of demand. A lot of traders are interested in starting their own fund," says Ram Rao, Director of Sales and Business Development at high frequency incubator Trading Cross Connects ("TXC").
The growing number of high frequency managers is also being seen by hedge fund consultancies with a broader scope. Jayesh Punater, who's Gravitas Technology services all strategies told Opalesque during a recent interview that while most new product launches are coming from large, established firms, the high frequency quant strategies are seeing numerous fund launches by new managers.
Rao, who works closely with newly launching HFT managers says the steady number of launches is largely attributable to the exit of HFT teams from the banks due to the combination of layoffs, reduction in proprietary trading, compensation restriction-fears and because of the all too human desire for freedom (it is one of the few strategies where the trading team can be located anywhere from the beach to the mountains, to the quiet of a home office). Add in the rapidly dropping costs for starting up a HFT firm (largely due...................... To view our full article Click here
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