FT.com published another good article on the state of high frequency trading that aligns pretty well with the shifts we have seen in the market. The theme of the article is that opportunities in HFT are becoming less abundant and, as a result, many HFT firms are turning back to quant strategies that differentiate based on unique market pairings or predictions of where the markets will move.

As one of our customers that chose to sidestep HFT from the beginning told us:

“Differentiating on speed is not appealing to us. There can only be one fastest, and even if it is you today, it probably won’t be tomorrow.”

There’s no doubt that electronic trading will continue to dominate volumes, but expect the focus to shift back towards unique arbitrage and quantitative strategies for many current HFT participants.

Larry Neumann

From 2005 to 2017, Mr. Neumann was responsible for all aspects of strategic, corporate, product and vertical marketing. Before Solace, he held executive marketing positions with TIBCO and Oracle, and co-founded an internet software company called inCommon which was acquired by TIBCO. During his tenure at TIBCO, Mr. Neumann played a key role in planning company strategic direction relating to target markets and candidate acquisitions.