What is high frequency trading is a common question I always get.
Many people actually ask me if I trade with HFT since I have been trading for so long and do have algorithms and robots that trade for me as well. This film discusses what high frequency trading is and why it is horrible for the markets.
Trading with high frequency firms will defend the practice and say that it is good for the markets. One thing that you must know is that HFT trading IS LEGAL. 100% legal. It is not illegal. Everyone still permits this and the current exchanges are trying to block and also potentially sue the SEC and government for possibly approving an exchange that will limit the ability to be able to trade this way.
Front running is also legal and horrible for all of us. This is where the super fast algorithms and robots that are performing the high frequency trades ahead of the trades that we put into the market. This is a lot of times why people ask why is high frequency trading legal?
The robots essentially see our orders and buy and sell back to us the same security that we are trying to purchase. Since we are using market orders, meaning that we tell the broker to "fill us at the best price" the price can move suddenly. Even if its just by a few cents. This equates to hundreds of millions of dollars in profits for high frequency (HFT) firms and hundreds of millions of losses for normal traders like you and me.
Unfortunately, it will remain legal for the foreseeable future. Watch the full video to learn more on what high frequency is and it's legal.
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What is high frequency Trading? HFT
What is High Frequency Trading? (HFT) And why its Legal? how to trade in roblox | |
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| How-to & Style | Upload TimePublished on 3 Jun 2016 |
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