I have been working in high frequency trading since 2005, before it had a name, before it was even 20% of the market, let along the 97% of the market that it has become today.
You are absolutely right that HFT is becoming less profitable.
One does not have to look farther than the stock prices of two leading firms to see that. Here is market leader virtu financial, which dropped to less than half its IPO price.
But that’s not the only thing that is happening.
- Machine Learning is becoming the key to high frequency trading?
- HFT is becoming slower and making more money from medium term trading than from pure HFT.
- Some of us are taking the brave step of making HFT into a service, that every investor can use and never be picked off by HFT firms!
In the following video, Bill and I fielded these questions:
- What is the role of machine learning in High Frequency Trading?
- We see a lot of startups in other fields of technology, but why not in HFT?
- How does ML make use of the information in the order book?
In the following video, I have talked about the business of high frequency trading, and where Machine Learning comes in. While everyone is very secretive of HFT, here I have presented the two most successful trades in HFT and why they work.
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