The various types of high-frequency trading-strategies

High speed trading has investment firms capable of instituting it storm due to the involved it benefits included. Complete with large amounts of investment, be considerable profits. There are various high-frequency trading strategies, manage the results of the market of programmed computer. These include trends, few movements, change neutral approaches and scalping.

Trend approach

If an algorithm can predict a market trend for a long time, can the user to position its business between profit on the points of light and drops. While day to day completely arbitrarily move the market, the market will investigate a trend in the course of time in a certain direction. If you know that the merchant can shave profits from secluded positions in the meantime.

Few movement

Few trade sees risk balance, by ensuring that transactions that occur for two go. This approach moves an opposite trade on the desired trade. It may loss because the opposite pair trade nonsense if you want trade fails, WINS was the market in that direction. In the course of time, more victories make profits as losses, even if the WINS are marginal. Gains made in a radio frequency mode, the aggregate in real money.

Change prevention

Typically in situations where value is desired, allows a delta-neutral strategy several trades occur as long as the entire portfolio not much changes value, if at all. For those who are nearing retirement or it can be, this can be a popular position, while still on the market. While trade could be up and down all day, this is mathematical result little change on the bottom line.

Scalping

The algorithm trading is scalping an electronic, high-speed-trade version "buy cheap and sell dear." However, with high frequency trading strategies may be the price changes at the level of the penny. This approach requires a high level of volatility in the day to be useful. The transactions buy and sell the same position quickly, keeping only long enough to make a marginal difference before the Elimination of the risk. Where computers are involved in, this can be at light speed in the software parameters once programmed. Regardless of whether the market or not tends profit is the entire goal is simply the current difference of market prices, often on when they are on the rise. However, it can be played in the opposite direction with option trades.

High frequency trading strategies are a great opportunity for your company. Read more articles on our Web site.