Pandela

High-frequency trading strategies (algorithms)

What is High-frequency Trading?



Share:  



High-frequency trading (HFT) is the main form of trading in today’s algorithmic market. More specifically, it characterizes the speed of execution in computerized algo-trading strategies with extremely short holding periods of as little as a few seconds or milliseconds. Going even a step further, Ultra high-frequency trading, (also known as low-latency trading), shortens the speed of trade execution down to the sub-millisecond. The High-frequency trade market uses automated trading platforms engineered with High frequency trading algorithms to move in and out of short-term positions at high enough speed and volumes to capture fractional profits on every trade.

Obviously, the nature of High-frequency trading strategies focuses on short-term investments which means that High-frequency traders usually only compete with each other, rather than with long-term investors. Therefore, High-frequency trading has evolved into a trading territory of its own, known as HFT markets. Because High-frequency trading is initially reliant upon extremely high quantity volumes to profit from the low margin trades, up until recently it was an exclusive market monopolized by the big banks and hedge firms such as Goldman Sachs, JP Morgan, Morgan Stanley, etc., whose business is mainly high volume trading.

Another reason that the HFT markets were limited to the big businesses is because they were the only ones who could afford to pay for the High frequency trading platforms that not only offer first dibs on the market data and buy/sell opportunities, but can monitor multiple markets, 24 hours a day with little human interaction required. So basically, only those who had the billions of dollars to spend on HFT systems that could jump start them to the front of the trading line, were also the ones who have been making the majority of their profits over the last few years through High-frequency trading and succeeding even when the rest of us suffered less than favorable market periods.

As a result, High-frequency trade has been in the hot seat of controversy with critics saying that it suggests that money can buy an unfair edge on stock trading and that the companies monopolizing the HFT algorithmic systems are even able to manipulate the market in general. But there has been more research to indicate that HFT is scoring points across the board and rather than it being outlawed, regulators are studying how to embrace it into the markets overall.

In other words, High-frequency trading is here to stay and if you want to continue making money stock trading, then it’s time to join the algorithmic revolution.

 

 

The Advantages of High-Frequency Trading

While many argue that High-frequency trading allows unfair advantages and causes market volatility, there is more research to indicate otherwise. While it certainly offers more advantages to those with access to the algorithmic systems that can employ HFT strategies, HFT is also benefiting today’s financial system overall.

  • High-frequency trade and automated markets improve market liquidity, reduce trading costs and make stock prices more efficient.
  • High-frequency trading shrinks the gap between bid-ask spreads, even eliminating the difference all together in the smallest margins in the course of a day. (Compare the 90-point bid ask spreads of the mid-1990s to the 3 point spread that we’re seeing in 2014.)
  • High-frequency traders buying when the price is below trend and selling when the price is above trend, which reduces the price fluctuations.
  • High-frequency trading strategies are proven to succeed by their ability to process large volumes of information from multiple markets, which even the most expert human traders cannot do.

Not surprisingly, the obvious advantages of High-frequency trading has convinced more investors to jump on board with it rather than protest it. In fact, in 2010 HFT had already grown to account for 56% volume of the entire equity turnover in the U.S., up from 21% in 2005. HFT markets have been continuing to grow even more rapidly over the last few years and now they encompass a majority of both the overall U.S. and European equity trading volume, and spreading across the globe to other regions such as the Asia-Pacific and South Africa.

Despite the critics, the impact of High-frequency trading algorithms has proven to score enough points to earn its permanent place in the market. The future of algorithmic trading is already here and while regulators are studying how to merge it into the new market millennium, modern technology is already going ahead and inviting individual investors in on the game.

High-frequency Trading for Individual Investors

The financial market has always been a game of survival of the fittest and survival of the fastest has always been a major component of stock trading, therefore its only natural evolution if we embrace technology and the advantages that High-frequency trading algorithms allow us today. Assuming that most individual investors want to continue to make money trading rather than complain about others who are, then its time to get on the playing field with your own algo-trading system and a winning High-frequency trading strategy to advance your game.

Think about it. If you had access to a high-frequency trading platform that was specifically engineered to execute your personal stock trading strategies at the fastest possible speed, how could you not take advantage of the opportunity?

The Wall Street Trading Room is among the first online trading firms to offer exclusive access to the best, tested and true algo-trading system for individual investors. Her name is Pandela™ and she was custom designed by an expert team of software engineers and finance professionals to be your personalized portal into the world of algorithmic trading and give you the ultimate competitive edge.

Pandela is the most advanced algorithmic trading software available to individual investors on the market today, allowing day traders at every level to enjoy the maximum benefits of High-frequency trading.

 

 

The Wall Street Trading room also takes the essential extra step for you to optimize Pandela’s high profit performance by sharing our stock trading strategy expertise with one-on-one mentoring and on-going video tutorials.

The future of automated stock trading is already happening today and it’s time to take the ultimate competitive edge of a win-win strategy that combines the best trading technology and training. The Wall Street Trading Room is among the first on-line trading firm to offer the best of both these worlds: The best, tested and true personal algo-trading software system currently available on the market and the best, tested and true professional expertise teaching you the most effective high-frequency trading strategies tailored to your specific needs.

See what some of our graduates and trading floor members have to say

member picture

I've been a member in a few trading rooms over the past 2 years, and checked out several more. I have to say that of all the rooms I've seen, this new room is the best. Experienced traders gather here to trade stocks and options, both intra day and swing, and I've never seen a better, more consistent group of traders in any other room. Mark has years of broadcast and chart recognition experience, and Donny has an uncanny ability to find high volume trending stocks every day. Together they are an unbeatable team leading a group of experienced traders on a daily mission to find high probability trades. This room works.

Doug Walraven
member picture

I have been in other trading rooms for several years and now with Mark Melnick and Donny in Wall Street trading room. I am so happy with the calls Mark and makes and his A+ targets. I have been a stock broker in New York and L.A.
I ran a hedge fund for over 20 years.
I wrote a book available on AMZN How to Invest by Instinct.
I am consistently profitable because of Mark and Donny's calls.
If you go to another trading room you are crazy!

Lin Eldridge
member picture

I was doing some stats on win/loss % on my trades that utilized descending resistance breaks, ascending support bounces A+ triggers and gap fills.
Since I have been tracking these trades I have done 187 total trades, 149 profitable and 38 losing trades for a winning percentage of 79.67%
I think this is a pretty amazing win rate and I have to credit you for teaching me the proper way to draw support and resistance lines as well as finding A+ triggers.
Some trades were intraday and some were swings (especially the ascending support bounces which seem to require more time to maximize profits I.E. GS recently).
I sincerely appreciate all your help and education. I truly love charting and trading and of course the financial freedom and security it has afforded my wife and I.
I have used investigated other trading rooms (Shines of course, Pristine and Keene).
I find your methodology much more focused and direct as well as much more effective. I believe Wall Street Trading Room will become a major success with traders simply because of the focused methodology and excellent results.

Dave Wyse
member picture

I found myself out of college and no work so I decided to look at home business and I came in contact with the guys at WSTR I did their education training and so please with them now I'm making a living and paying back my student loans

Shara I, LV, NV
member picture

I'm a single mother in Russia and trying to do best for myself and child I now can support myself and child thanks guys for the education

Klavdiya R
member picture

Just got to say thanks for having a knowledgeable Live Trading Room that helps me everyday see great stock calls and being able to interact with some great Trading Members very strong community keep it up Mark & Donny

Rick, Sacramento, CA
member picture

I'm from Japan and the Trading room has translation languages so I click Japanese and it gives me all the chats in Japanese very nice wallstreettradingroom

Masyuki L, Japan