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How to think about high-frequency trading firms

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Petitjean, Mikael [UCL]

In this short article, I explain that the emergence of high-frequency trading firms comes from the increasing fragmentation of financial markets since the early 1990's. I also summarize the advantages and disadvantages of high-frequency trading, which have been identified in the empirical literature. I then define the role played by these high-frequency trading firms during the 'flash crash' on Thursday May 6, 2010. I conclude by underlying that automated trading does not necessarily lead to worsening market conditions, given the animal spirits of traditional investors in stressful periods.

Document type Article de périodique (Journal article) – Article de recherche
Access type Accès libre
Publication date 2011
Language Français
Journal information "Forum financier : revue bancaire et financière" - Vol. 1-2, no.1-2, p. 70-72 (avril 2011)
Peer reviewed yes
Publisher Larcier ((Belgium) [S.l.])
issn 2033-7825
e-issn 2033-7825
Publication status Publié
Links
Bibliographic reference Petitjean, Mikael. How to think about high-frequency trading firms. In: Forum financier : revue bancaire et financière, Vol. 1-2, no.1-2, p. 70-72 (avril 2011)
Permanent URL http://hdl.handle.net/2078/117048