Software & Finance

Stock Market - High Frequency Trading

High frequency trading is an algorithm that decides when to place an order, mostly with out any human intervention. These algorithms are developed using programming languages like C++ and Matlab usually in Linux/Unix environment. At the end, these are mere programs running in the servers that watch the real time market data. When there is a sudden market collapse and when we need to respond immediately rather than waiting for human intervention, programs takes control of trading in the exchanges. Algorithms can be implemented for liquidation or intraday market speculation or arbitrage trading or depends upon the business need. Programs need to make the correct judgment by watching the real time market data. The programs need to identify the market trend, technical support, trading unusual volume, etc.

Posted on May 09, 2010