Monday, February 20, 2017

High Frequency Trading had a bad name

High Frequency Trading (HFT) has been given a bad name by the activities of certain users of the technique who have been guilty of obtaining an unfair advantage through the use of secretive, high-tech methodologies that remove the risk from their operations, to the detriment of others.

When a company can trade any commodity, especially currency pairs, and boast that it never made a daily loss in years of activity, one can be sure that its "traders" are bending the rules. Many of the nefarious practices that have come to light are detailed in Michael Lewis’s famous book, “Flash Boys”. The good news is that the regulators have now woken up to what was happening, and have used their powers to create a more level playing field for all.

The use of computers and computer software to interact with the market, often known as “algorithmic trading”, is of course legitimate. Here, the edge is provided by the experience and skill of the practitioners, and by their willingness to put in the effort to use all the resources at their disposal to learn about the price action of currency pairs, and their reaction to fundamental events.

That is what we do here at Ethical HFT (, the managed Forex account arm of OmicronFX Limited. We call it ethical because we do not indulge in practices that are illicit in order to get our results, while at the same time we make the very best use of modern technologies and systems.

No comments:

Post a Comment