Not only does electronic trading continue to make our financial markets more competitive, but it has brought numerous benefits to all investors This presentation seeks to provide an overview of the evolution of electronic trading, provide clear definitions of often misused terms, and demystify electronic trading strategies like high frequency trading.
Among the topics discussed in this presentation:
The modernization of our financial markets using electronic trading
Definitions of electronic trading, algorithmic trading and high frequency trading
The Securities and Exchange Commission and high frequency trading
The Commodity Futures Trading Commission and high frequency trading
Regulatory framework in place to safeguard investors who invest in markets where electronic trading is prevalent
IABF Education Institute gives to you details about Stock Market details, How to know about stock markets, What is Stock Market, Who is broker, What is D/Mat A/C, Functions of Brokers, Know about NIFTY,
IABF Education Institute gives to you details about Stock Market details, How to know about stock markets, What is Stock Market, Who is broker, What is D/Mat A/C, Functions of Brokers, Know about NIFTY,
Stocks can also be categorized in various ways. One common way is by the country where the company is settle For example, Nestlé and Novartis are settled in Switzerland, so they may be considered as part of the Swiss stock market, although their stock may also be swap at interchange in other countries
How does the stock market work?” Is a question you should ask yourself before you develop stock market strategies and start investing in the stock market. The answer to this question is simple, companies go public by offering a specific number of stocks in their company to the public through the stock exchange. Investors then can use the stock exchange to buy and sell stocks of companies that they are interested in. While this basic description of how the stock market works is adequate enough to understand what the stock market is, to get a better understanding of how it actually works it will be important to learn about the market and stock market strategies though a formal education.
This presentation is created for education purpose only. This presentation gives information about various aspects of stock broking services in India. Following are the various points covered regarding stock broking services:-
Types of broker, Nature of Work,Regulation for brokers , Eligibility Criteria for Membership, Admission Procedure for New Membership, Role & function of brokers, responsibility of broker, Worker ethics for broker ,Process of order execution ,Ways through broker earn money, Major brokerage firms in India.
This power point presentation will describe you about stock exchange of India , Its history, working and progress and a list of recognized stock exchanges In India
Stocks can also be categorized in various ways. One common way is by the country where the company is settle For example, Nestlé and Novartis are settled in Switzerland, so they may be considered as part of the Swiss stock market, although their stock may also be swap at interchange in other countries
How does the stock market work?” Is a question you should ask yourself before you develop stock market strategies and start investing in the stock market. The answer to this question is simple, companies go public by offering a specific number of stocks in their company to the public through the stock exchange. Investors then can use the stock exchange to buy and sell stocks of companies that they are interested in. While this basic description of how the stock market works is adequate enough to understand what the stock market is, to get a better understanding of how it actually works it will be important to learn about the market and stock market strategies though a formal education.
This presentation is created for education purpose only. This presentation gives information about various aspects of stock broking services in India. Following are the various points covered regarding stock broking services:-
Types of broker, Nature of Work,Regulation for brokers , Eligibility Criteria for Membership, Admission Procedure for New Membership, Role & function of brokers, responsibility of broker, Worker ethics for broker ,Process of order execution ,Ways through broker earn money, Major brokerage firms in India.
This power point presentation will describe you about stock exchange of India , Its history, working and progress and a list of recognized stock exchanges In India
A session at the CBS Competitiveness Day 2015 - In recent years financial markets have undergone a huge transformation driven by technology and regulation. Both the structure of the markets in which participants operate and the behavior of those participants have seen a phase shift towards increasing fragmentation and digitalization where trades take place in micro- or even nanoseconds. We will present a study of high-frequency trading and show how the use of high-speed algorithms might transform the financial markets.
In The Speed Traders, Edgar Perez, founder of the prestigious business networking community Golden Networking, opens the door to the secretive world of high-frequency trading (HFT). Inside, prominent figures of HFT drop their guard and speak with unprecedented candidness about their trade.
Op Risk High Frequency Trading June 14 Finaltestytre
Presentation on High Frequency Trading risks delivered during OpRisk conference in London in June 2012. Content includes an overview of key risks affecting high frequency trading.
1. Failure to meet regulatory and exchange requirements.
2. Removal of human decision making once the algorithms are finished.
3. Extreme market behaviour: Flash Crash (2010).
4. Theft or loss of Intellectual Property.
5. Errors or problems suffered by clients using Direct Market Access and Algo/HFT.
6. Business impact of latency (system errors may increase delays).
7. Limited security controls at the infrastructure level.
8. Failure of hedges. 9. Incorrect/untested strategies.
David Ramirez
IT Audit Director
The slide-doc tutorial explains
* Basic constructs for Resource Description Framework (RDF) and Ontology Web Language.
* Semantic Web Layers and types of ontologies
* Reference ontologies for Legal and Finance
* How to open and browse the ontologies in Protégé
Today’s trading is complex and frequently involves little human intervention. Five years after the "Flash Crash," do you know how high frequency trading and dark pools work? Our new report separates fact from fiction.
Quant trading theory series: electronic marketsOliver Laslett
The Soton Quants 3-part Trading Series begins with electronic markets.
Learn the effects of market microstructure on high-frequency trading and large trades.
EXTENT-2016: MiFID 2 Compliant Fixed Income SOR SystemIosif Itkin
EXTENT-2016: Software Testing & Trading Technology Trends
22 June, 2016, 10 Paternoster Square, London
MiFID 2 Compliant Fixed Income SOR System
Ferdinando La Posta, Co-founder and CEO, GATElab
Would like to know more?
Visit our website: extentconf.com
Follow us:
https://www.linkedin.com/company/exactpro-systems-llc?trk=biz-companies-cym
https://twitter.com/exactpro
#extent2016
#exactpro
Real-time, high-frequency trading (HFT) is placing increasing pressure on regulatory compliance teams to keep up with and monitor the industry's widening pools of structured and unstructured data. Emerging technologies can help capital markets firms use big-data analytics to collect, classify and analyze high volumes of data to formulate strategies for better surveillance, compliance and spot abuse.
Apidays Singapore 2024 - Modernizing Securities Finance by Madhu Subbuapidays
Modernizing Securities Finance: The cloud-native prime brokerage platform transforming capital markets.
Madhu Subbu, Managing Director, Head of Securities Finance Engineering
Apidays Singapore 2024: Connecting Customers, Business and Technology (April 17 & 18, 2024)
------
Check out our conferences at https://www.apidays.global/
Do you want to sponsor or talk at one of our conferences?
https://apidays.typeform.com/to/ILJeAaV8
Learn more on APIscene, the global media made by the community for the community:
https://www.apiscene.io
Explore the API ecosystem with the API Landscape:
https://apilandscape.apiscene.io/
Big Money in Centralized Crypto Exchange Development (1).pdfSkylarL
Attention all crypto enthusiasts! Are you tired of juggling multiple accounts and exchanges to manage your digital assets? Say no more as Beleaf Technologies is here to provide you with a one-stop solution. Introducing our centralized crypto exchange development service, designed to cater to all your trading needs. With features like secure wallet integration and advanced trading tools, you can manage your portfolio with ease. Trust us to provide you with a seamless trading experience and take your crypto game to the next level. Contact us today to learn more!
Digital transformation of global securities exchangesLapman Lee ✔
Global securities exchanges have much to gain from automating nontrading operations, yet digital improvements in this area are lagging. Our new report explores the factors driving digital transformation in banking, the characteristics and capabilities of the exchange of the future, and guidance on how to get your transformation journey started.
Best Crypto Exchanges In Ontario Now That Binance Is Banned.pptxCrypto in California
The recent ban on Binance in Ontario has prompted cryptocurrency traders to seek alternative exchanges that comply with regulatory standards and provide a secure trading environment. As the crypto industry continues to evolve, it is essential to find trustworthy platforms that prioritize user safety and offer a diverse range of cryptocurrencies. In this blog, we will explore the best crypto exchanges in Ontario, focusing on key factors like security, regulatory compliance, and user experience.
Best Crypto Exchanges In Ontario Now That Binance Is Banned.pptxCrypto in California
The recent ban on Binance in Ontario has prompted cryptocurrency traders to seek alternative exchanges that comply with regulatory standards and provide a secure trading environment. As the crypto industry continues to evolve, it is essential to find trustworthy platforms that prioritize user safety and offer a diverse range of cryptocurrencies. In this blog, we will explore the best crypto exchanges in Ontario, focusing on key factors like security, regulatory compliance, and user experience.
OCO order is a risk management tool that is designed to manage the exit strategies. TrailingCrypto allows you to place OCO order combining a limit order with a stop limit order where an order is canceled if any one of them is filled.
OCO order is a risk management tool that is designed to manage the exit strategies. TrailingCrypto allows you to place OCO order combining a limit order with a stop limit order where an order is canceled if any one of them is filled.
IMF Fintech report - cross board paymentClement Hsieh
The PPT content comes from IMF "Fintech and Financial Services - Initial Considerations" report. It gives clear overview to cross board payment, so it is used in our graduate Fintech course as case study.
Trading has changed from local to global and so have the processes from paper to Online. The result is change in process from T+3 to T+1 and real time trading and settlement of a trade.
This presentation highlights a number of the most important policy issues on which MFA remains focused. Issues covered in this document include, among others:
• Promoting non-discriminatory tax policy.
• Taxation of partnerships
• CFTC reauthorization
• Regulating systemic risk
• Protecting investors
• Promoting the stability of markets through central clearing of derivatives
• Capital formation and the JOBS Act implementation
• Equity market structure
Who Invests in Hedge Funds? A Sampling of the Hedge Fund UniverseManagedFunds
This educational infographic takes readers through the many types of hedge fund investors, offering data points along the way to illustrate the importance and magnitude of each class of investors.
MFA's new educational presentation explains the fees associated with hedge funds and how they are used by hedge fund managers. Generally, hedge fund structures incur management fees and performance fees. Other terms explored in the presentation include high-water marks and hurdle rates. Of course, all hedge fund fees charged to any particular investor are based on contractual terms agreed to by the fund manager and the investor. While there is no such thing as a “standard” fee, there are a number of general terms that apply to hedge fund fees.
Measuring Hedge Fund Performance: Investors Weigh In InfographicManagedFunds
Investors in hedge funds look to those allocations to fulfill a number of objectives for their portfolios, according to new data from Preqin. MFA used those data to illustrate a number of important points on how investors measure hedge fund performance in a new infographic.
Measuring Hedge Fund Performance: Investors Weigh InManagedFunds
Institutional investors partner with hedge funds to achieve specific, unique goals within their investment portfolios.
According to the Preqin data, key objectives most frequently cited by investors include:
-Returns that are uncorrelated to equity markets (ie. S&P 500)
-Absolute returns in all markets
-Dampening portfolio volatility and diversifying total portfolio
A Primer on Distressed Debt Investing InfographicManagedFunds
A Primer on Distressed Debt Investing provides easy to understand visual depictions of how distressed debt investing works and explains how these investors often work alongside financially distressed companies to ensure a successful restructuring or bankruptcy proceeding. It also illustrates how distressed debt investments can help provide a number of positive results, including increased liquidity, a positive impact on overall company value, a higher degree of debt recovery, and relief of financial constraints.
Distressed Debt Investing: Resources to Help Investors Better Understand The...ManagedFunds
"Distressed Debt Investing: Resources to Help Investors Better Understand Their Investment Options in this Asset Class" is aimed at helping investors better understand their investment options in the distressed debt space. The presentation gives an overview of distressed debt investment and the role these investors play in the bankruptcy process by creating liquidity in the credit markets, lowering the cost of lending, and helping companies that may be close to bankruptcy or in bankruptcy with additional capital.
The presentation details a wide range of legislative and regulatory initiatives that are likely to impact the global alternative investment industry in the year ahead.
2014: The Year Ahead for Hedge Funds offers an overview of some of key dates and expected actions associated with market reforms around the globe. MFA is working to ensure that reform is consistent across jurisdictions.
Topics of note in the presentation include:
U.S.:
-Tax Reform
- JOBS Act
-CFTC Nominations and Reauthorization
-CPO/CTA Regulation
-FATCA
EU:
-EU Commissioner Selections
-MiFID II Legislation and Implementation
-Financial Transaction Tax
-EMIR/AIFMD
Who Invests in Hedge Funds in My State?ManagedFunds
The Hedge Fund Investor Map takes publicly available data from both public and private pension plans, university endowments, and foundations in all 50 states to show what groups are investing in hedge funds. Public pensions such as the AFL-CIO, AFSCME, or Florida Retirement System, and corporate pensions like UPS, 3M, or John Deere all invest in hedge funds. In fact, public pension funds represent the largest portion of capital invested in hedge funds by institutional investors at over 22%.
The partnership between hedge funds and university and college endowments continues to grow. For many educational institutions, hedge funds are an important tool used to diversify their portfolios, manage risk and produce reliable returns. Hedge fund investments help these institutions fund financial aid, scholarships, operations, research, academics and athletic programs.
The factsheet provides a concise description of the function and benefits of managed futures, while also explaining some of the key differences between public and private pools. This resource explains the purpose of managed futures, their role for investors, how they are regulated, and what fees are charged and disclosed to investors.
Hedge funds were developed to help diversify investment portfolios, manage risk, and deliver reliable returns over time. Many investors use hedge funds as an uncorrelated diversification vehicle. Investors rely on hedge funds to produce “risk adjusted returns” and the most effective way to analyze their performance is to understand what these returns are.
European Union Legislative and Regulatory UpdateManagedFunds
This new educational and informational resource offers users in depth information on the many legislative and regulatory issues facing the hedge fund and managed futures industries in the EU.
Along with current status and scope of the issues, the presentation also lists MFA’s views on the issues and key concerns. This extensive guide covers a number of issues, including:
Financial Transaction Tax
Markets in Financial Instruments Directive (MiFID) and Markets in Financial Instruments Regulation (MiFIR)
Market Abuse Directive (MAD) and Market Abuse Regulation (MAR)
Shadow Banking
Alternative Investment Fund Managers Directive (AIFMD)
European Markets Infrastructure Regulation (EMIR)
European Short Selling Regulation
European Union Member State Short Selling Bans
Short Selling: A Brief Overview and Regulatory UpdateManagedFunds
For those hoping to learn more about this important function in our markets, this new presentation offers helpful information on what short selling is and how it works, different types of short selling, and provides an overview of the regulatory actions taken both in the U.S. and in Europe.
Other topics covered in the presentation include:
The benefits of short selling and how it is used as a hedge
How short selling is regulated in the United States
A brief overview of current EU short selling regulations
The economic effects of short selling bans in the U.S. and Europe
An overview of MFA’s global advocacy on short selling issues
Position Limits: A Brief History and Discussion of Recent Regulatory ChangesManagedFunds
This presentation provides a good understanding of an important issue relevant to the hedge fund industry.
This presentation features:
• A brief history of position limits.
• The regulatory framework for position limits.
• How position limits work, and the various types of position limits.
• Position limits and the Dodd-Frank Act.
• Recent rulemaking regarding aggregation.
• The role of hedge funds as a “buffer” against market volatility.
• MFA’s advocacy role surrounding this issue.
U.S. Regulation 101: Guide to U.S. Oversight of the Hedge Fund IndustryManagedFunds
With many regulations (both new and old), rules, and regulators, it is easy to get turned around when looking for the right answers regarding hedge fund regulation in the United States. Our presentation lays out those answers in a user-friendly format that explains how hedge funds are regulated and by what regulatory entities.
From the Securities and Exchange Commission to the Commodity Futures Trading Commission and more, hedge funds are subject to myriad regulations. And, with the Dodd-Frank Wall Street Reform and Consumer Protection Act still being implemented across many government agencies, the amount of scrutiny placed on hedge funds will only increase.
How Passage of the JOBS Act Impacts Regulation D: Private Placement and Gene...ManagedFunds
The recently enacted Jumpstart Our Business Startups (JOBS) Act contained a provision directing the Securities and Exchange Commission to amend Regulation D to remove the ban on general solicitation and advertising of private offerings. This change will allow alternative investment managers and others conducting private offerings to have increased legal certainty when communicating with investors and the general public, which will enable these managers to share more information and promote greater understanding of the industry. Amending Regulation D will not change the type of investor – institutions and high net-worth individuals – able to buy into a private offering, but it will lead to more transparency in the alternative investment industry.
Commodity Trading Advisor & Commodity Pool Operator 101ManagedFunds
Commodity Trading Advisors (CTA) and Commodity Pool Operators (CPO) have long been vital to the alternative investment industry. The presentation allows those new to the alternative investment industry to better understand how CTAs and CPOs function, how they are regulated, and how the Dodd-Frank legislation and recent CFTC rulemakings have affected these entities.
Included in presentation is information on the European Commission, Council of the European Union, European Parliament, European Council, and European Central Bank, as well as new regulatory entities such as the European Securities and Markets Authority. Information on some of the most important hedge fund-related regulations is also provided, including the Alternative Investment Fund Managers Directive (AIFMD), European Market Infrastructure Regulation (EMIR), short selling regulation, Review of Markets in Financial Instruments Directive (MiFIDII), and the Market Abuse Directive (MAD).
Improving profitability for small businessBen Wann
In this comprehensive presentation, we will explore strategies and practical tips for enhancing profitability in small businesses. Tailored to meet the unique challenges faced by small enterprises, this session covers various aspects that directly impact the bottom line. Attendees will learn how to optimize operational efficiency, manage expenses, and increase revenue through innovative marketing and customer engagement techniques.
What is the TDS Return Filing Due Date for FY 2024-25.pdfseoforlegalpillers
It is crucial for the taxpayers to understand about the TDS Return Filing Due Date, so that they can fulfill your TDS obligations efficiently. Taxpayers can avoid penalties by sticking to the deadlines and by accurate filing of TDS. Timely filing of TDS will make sure about the availability of tax credits. You can also seek the professional guidance of experts like Legal Pillers for timely filing of the TDS Return.
[Note: This is a partial preview. To download this presentation, visit:
https://www.oeconsulting.com.sg/training-presentations]
Sustainability has become an increasingly critical topic as the world recognizes the need to protect our planet and its resources for future generations. Sustainability means meeting our current needs without compromising the ability of future generations to meet theirs. It involves long-term planning and consideration of the consequences of our actions. The goal is to create strategies that ensure the long-term viability of People, Planet, and Profit.
Leading companies such as Nike, Toyota, and Siemens are prioritizing sustainable innovation in their business models, setting an example for others to follow. In this Sustainability training presentation, you will learn key concepts, principles, and practices of sustainability applicable across industries. This training aims to create awareness and educate employees, senior executives, consultants, and other key stakeholders, including investors, policymakers, and supply chain partners, on the importance and implementation of sustainability.
LEARNING OBJECTIVES
1. Develop a comprehensive understanding of the fundamental principles and concepts that form the foundation of sustainability within corporate environments.
2. Explore the sustainability implementation model, focusing on effective measures and reporting strategies to track and communicate sustainability efforts.
3. Identify and define best practices and critical success factors essential for achieving sustainability goals within organizations.
CONTENTS
1. Introduction and Key Concepts of Sustainability
2. Principles and Practices of Sustainability
3. Measures and Reporting in Sustainability
4. Sustainability Implementation & Best Practices
To download the complete presentation, visit: https://www.oeconsulting.com.sg/training-presentations
Premium MEAN Stack Development Solutions for Modern BusinessesSynapseIndia
Stay ahead of the curve with our premium MEAN Stack Development Solutions. Our expert developers utilize MongoDB, Express.js, AngularJS, and Node.js to create modern and responsive web applications. Trust us for cutting-edge solutions that drive your business growth and success.
Know more: https://www.synapseindia.com/technology/mean-stack-development-company.html
Kseniya Leshchenko: Shared development support service model as the way to ma...Lviv Startup Club
Kseniya Leshchenko: Shared development support service model as the way to make small projects with small budgets profitable for the company (UA)
Kyiv PMDay 2024 Summer
Website – www.pmday.org
Youtube – https://www.youtube.com/startuplviv
FB – https://www.facebook.com/pmdayconference
Putting the SPARK into Virtual Training.pptxCynthia Clay
This 60-minute webinar, sponsored by Adobe, was delivered for the Training Mag Network. It explored the five elements of SPARK: Storytelling, Purpose, Action, Relationships, and Kudos. Knowing how to tell a well-structured story is key to building long-term memory. Stating a clear purpose that doesn't take away from the discovery learning process is critical. Ensuring that people move from theory to practical application is imperative. Creating strong social learning is the key to commitment and engagement. Validating and affirming participants' comments is the way to create a positive learning environment.
What are the main advantages of using HR recruiter services.pdfHumanResourceDimensi1
HR recruiter services offer top talents to companies according to their specific needs. They handle all recruitment tasks from job posting to onboarding and help companies concentrate on their business growth. With their expertise and years of experience, they streamline the hiring process and save time and resources for the company.
Discover the innovative and creative projects that highlight my journey throu...dylandmeas
Discover the innovative and creative projects that highlight my journey through Full Sail University. Below, you’ll find a collection of my work showcasing my skills and expertise in digital marketing, event planning, and media production.
Digital Transformation and IT Strategy Toolkit and TemplatesAurelien Domont, MBA
This Digital Transformation and IT Strategy Toolkit was created by ex-McKinsey, Deloitte and BCG Management Consultants, after more than 5,000 hours of work. It is considered the world's best & most comprehensive Digital Transformation and IT Strategy Toolkit. It includes all the Frameworks, Best Practices & Templates required to successfully undertake the Digital Transformation of your organization and define a robust IT Strategy.
Editable Toolkit to help you reuse our content: 700 Powerpoint slides | 35 Excel sheets | 84 minutes of Video training
This PowerPoint presentation is only a small preview of our Toolkits. For more details, visit www.domontconsulting.com
"𝑩𝑬𝑮𝑼𝑵 𝑾𝑰𝑻𝑯 𝑻𝑱 𝑰𝑺 𝑯𝑨𝑳𝑭 𝑫𝑶𝑵𝑬"
𝐓𝐉 𝐂𝐨𝐦𝐬 (𝐓𝐉 𝐂𝐨𝐦𝐦𝐮𝐧𝐢𝐜𝐚𝐭𝐢𝐨𝐧𝐬) is a professional event agency that includes experts in the event-organizing market in Vietnam, Korea, and ASEAN countries. We provide unlimited types of events from Music concerts, Fan meetings, and Culture festivals to Corporate events, Internal company events, Golf tournaments, MICE events, and Exhibitions.
𝐓𝐉 𝐂𝐨𝐦𝐬 provides unlimited package services including such as Event organizing, Event planning, Event production, Manpower, PR marketing, Design 2D/3D, VIP protocols, Interpreter agency, etc.
Sports events - Golf competitions/billiards competitions/company sports events: dynamic and challenging
⭐ 𝐅𝐞𝐚𝐭𝐮𝐫𝐞𝐝 𝐩𝐫𝐨𝐣𝐞𝐜𝐭𝐬:
➢ 2024 BAEKHYUN [Lonsdaleite] IN HO CHI MINH
➢ SUPER JUNIOR-L.S.S. THE SHOW : Th3ee Guys in HO CHI MINH
➢FreenBecky 1st Fan Meeting in Vietnam
➢CHILDREN ART EXHIBITION 2024: BEYOND BARRIERS
➢ WOW K-Music Festival 2023
➢ Winner [CROSS] Tour in HCM
➢ Super Show 9 in HCM with Super Junior
➢ HCMC - Gyeongsangbuk-do Culture and Tourism Festival
➢ Korean Vietnam Partnership - Fair with LG
➢ Korean President visits Samsung Electronics R&D Center
➢ Vietnam Food Expo with Lotte Wellfood
"𝐄𝐯𝐞𝐫𝐲 𝐞𝐯𝐞𝐧𝐭 𝐢𝐬 𝐚 𝐬𝐭𝐨𝐫𝐲, 𝐚 𝐬𝐩𝐞𝐜𝐢𝐚𝐥 𝐣𝐨𝐮𝐫𝐧𝐞𝐲. 𝐖𝐞 𝐚𝐥𝐰𝐚𝐲𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞 𝐭𝐡𝐚𝐭 𝐬𝐡𝐨𝐫𝐭𝐥𝐲 𝐲𝐨𝐮 𝐰𝐢𝐥𝐥 𝐛𝐞 𝐚 𝐩𝐚𝐫𝐭 𝐨𝐟 𝐨𝐮𝐫 𝐬𝐭𝐨𝐫𝐢𝐞𝐬."
2. Introduction
New market structure regulations almost always require technological advancements,
either for compliance or new investment opportunities.
Questions have now been raised concerning stability, fairness, and benefits of electronic
trading, and the increasing sophistication of the technology necessary to support it. While
electronic trading capabilities have created benefits for investors, traders, and markets, a
lack of understanding remains about many market-related technological advances and
their impact. Improper definitions of electronic, algorithmic, and high frequency trading
have also caused significant misperceptions.
MFA’s members are investors who, like other market participants, expect efficient, fair,
and dependable markets, and who strongly support a robust regulatory environment.
This presentation seeks to provide an overview of the evolution of electronic trading,
provide clear definitions of often misused terms, demystify electronic trading strategies
like high frequency trading, and highlight the numerous benefits associated with
advances in market technology and electronic trading functionality.
2
3. Contents
Modernization of Markets
4
Electronic Trading
5
SEC and High Frequency Trading
6
CFTC and High Frequency Trading
7
Media Focus
8
Algorithmic Trading
9
Electronic Trading Benefits
10
Subject to Extensive Regulatory Framework
22
MFA Promotes Best Practices for Electronic Trading
25
References
26
3
4. Modernization of the Markets
• Before buy and sell orders could be submitted electronically and matched by computers
as they are today, investors had to contact a broker to place an order manually – often
for a substantial fee or commission.
• In the past, investors had little choice but to send their orders through a broker to
Nasdaq and NYSE market makers. The substantially weaker competition among
exchanges in the past made trading manually through brokers and utilizing specialists
and market makers both inefficient and expensive, with wider Bid/Offer spreads and
higher execution fees resulting in significant costs.
• Today, investors and traders can place orders electronically from devices such as
laptops or smart phones for a fraction of the previous cost, can choose among several
markets to send their orders, and can trade with many more market participants.
• These innovations, along with regulations designed to provide all investors equal
opportunities, have created a more efficient, inexpensive, and reliable trading
environment. The current market technology will serve as a foundation for even more
efficient markets in the future.
4
5. Electronic Trading
Electronic trading defined: Electronic trading occurs when a market participant executes an
order with no human interaction.
Electronic trading emerged in the 1990’s and quickly gained
popularity as investors benefited from faster execution
times, lower costs, and general greater efficiency.
*
Nearly all transactions in today’s markets are
executed electronically. In fact, electronic trading has
become mainstream for many investors. From large
trading rooms to small hand-held devices such as smart
phones, a variety of methods to access the markets are
now possible.
The advent of electronic execution revolutionized the
financial marketplace – eventually allowing an investor or
trader with a computer to make a trade without having to
speak to a broker and pay the corresponding expensive
commissions. Today, electronic trading accounts for a
majority of transactions worldwide and nearly 90% of
transactions in U.S. equity markets.
*Graphic: Credit Suisse, “Who Let the Bots Out? Market Quality in a High Frequency World ”, Trading Strategy, March 19, 2012.
5
6. SEC:
High Frequency Trading
As noted by regulators, “High Frequency Trading” (HFT) is relatively new and difficult to
define. The Securities and Exchange Commission (SEC)* has stated that term typically is
defined as “professional traders acting in a proprietary capacity that engage in strategies that
generate a large number of trades on a daily basis.”
• The SEC points to the following elements, among others, as potentially signifying high frequency
trading:
1. the use of extraordinarily high-speed and sophisticated computer programs for generating, routing, and
executing orders;
2. use of co-location services and dedicated market data feeds offered by exchanges and others to minimize
information transfer latencies.**
3. very short time-frames for establishing and liquidating positions;
4. the submission of numerous orders that are cancelled shortly after submission; and
5. ending the trading day in as close to a flat position as possible (that is, not carrying significant, unhedged
positions over-night).
• High frequency trading is usually conducted by a proprietary trading firm, a proprietary trading desk
at a broker-dealer, or by an investment adviser.*
*The U.S. Securities and Exchange Commission (SEC) – www.sec.gov
**SEC, Concept Release on Equity Market Structure, January, 14, 2010.
6
7. CFTC:
High Frequency Trading
The Commodity Futures Trading Commission (CFTC)* is formulating a definition of
HFT as a form of automated trading that employs the following:
• algorithms for decision making, order initiation, generation, routing, or execution, for each individual transaction
without human direction;
• low-latency technology that is designed to minimize response times, including proximity and co-location
services;
• high speed connections to markets for order entry; and
• recurring high message rates (orders, quotes, or cancellations) determined using one or more objective forms of
measurement, including:
•
•
•
cancel-to-fill ratios
participant-to-market message ratios
participant-to-market trade volume ratios.
The CFTC also notes that high frequency trading ‘is a mechanism utilized by a variety of trading
strategies [including – but not limited to – liquidity provision and statistical arbitrage].’ **
*The U.S. Commodity Futures Trading Commission (CFTC) – www.cftc.gov.
**CFTC Technology Advisory Committee Sub-Committee on Automated and High Frequency Trading – Working Group 1, Draft Definition of HFT October 2012.
7
8. Electronic Trading and High
Frequency Trading in the Media
• Electronic trading -- and more specifically high frequency trading -- has been the
subject of public focus and debate since the May 2010 “Flash Crash” which began
when a mutual fund initiated a rapid selling program in response to increasing volatility
and concerns about European debt. Market participants including HFT strategies
initially absorbed this selling; however, a liquidity crisis developed following the
activation of trading algorithms which reinforced the selling pressure and encouraged
some participants to halt trading.*
• Market structure legislation based on headlines instead of empirical research may
engender rather than reduce uncertainty, possibly leading to increased volatility and
diminished investor confidence. MFA and its members work proactively with regulators
to help educate market participants and regulators as well as to improve regulation
worldwide to strengthen the integrity of market structure for all investors.
• MFA strongly believes that regulators globally must acknowledge the benefits of
electronic trading technology while continuing to monitor all types of trading and
investment activities closely. The next several slides provide an overview of the
benefits of electronic trading and high frequency trading.
*CFTC –SEC, “Findings Regarding the Market Events of May 6, 2010.” September 30, 2010.
8
9. Algorithmic Trading
Algorithmic Trading ̶ Electronic Evolution Continues
• The rapid adoption of electronic trading, reduced costs, and an expanding global
network of exchanges from which to choose created the foundation for “Smart”
execution systems, or Algorithmic trading. Algorithmic Trading is not necessarily “high
frequency,” as an investor could use algorithms to trade gradually over the long term.
• Algorithmic trading defined: Algorithmic trading uses mathematical models to
determine the optimal time and venue(s) to execute a buy or sell order. The
algorithms are designed to analyze market data and trends continuously in order
to execute an investor’s orders as efficiently as possible.
Algorithmic Trading Benefits Many Types of Investors ̶ Investors of all sizes use
algorithmic trading to manage a large order (buy and sell) as series of smaller orders with
the goal of reducing transaction costs (bigger orders cost more to execute) while
lessening market impact. Investor types that use algorithmic trading include the
following, among others:
•
•
•
Pension funds
Foundations
Investment banks
•
•
Sovereign wealth funds
Hedge funds
•
•
Endowments
Mutual funds
9
10. Electronic Trading
Benefits Investors
Technological advances accompanying automated, electronic markets have
brought numerous benefits to investors of all types. These benefits – described
on the following slides – include the following:
•
•
•
•
•
•
Lower Volatility
Increased Liquidity
Reduced Transaction Costs
Smaller Bid / Ask Spreads
Improved Price Discovery
Enhanced Risk Management
10
11. Expert Viewpoint - HFT and
Market Efficiency:
According to a November 2013 white paper by European Central Bank scholars:*
“…[High frequency traders] provide a useful service to markets. They reduce the noise
component of prices and acquire and trade on different types of information, making
prices more efficient overall.
Introducing measures to curb their activities without corresponding measures to that
support price discovery and market efficiency improving activities could result in less
efficient markets.”
*European Central Bank, “High Frequency Trading and Price Discovery,” November 2013.
11
12. Electronic Trading
Benefits Investors
“The Future of Computer Trading in Financial Markets - An International
Perspective” was an independent study commissioned as part of the UK
Government’s Foresight Project. Over 150 academics from over 20 countries have
been involved in this study. Over 50 independent academic studies were
commissioned.
This is the most in-depth report on computer and high frequency trading to date.
• The report concludes that, available evidence indicates that, computer-based trading “has several
beneficial effects on markets,” such as improved liquidity, lower transaction costs for both retail and
institutional investors, and more efficient market prices.
• The study found no direct evidence to suggest that computer-based HFT has increased volatility in financial
markets or led to an increase in market abuse.
• The report indicates that it is unlikely that currently discussed legislation for HFT would achieve the desired
effect and could have unintended consequences. The authors of the academic studies were “unanimously
doubtful that minimum resting times would be a step in the right direction.” The evidence also offers little
support for policies imposing market-maker obligations.*
• Effective regulation must be founded on robust evidence and sound analysis. Regulators must be
aware that market structure evolves and that new regulations should be considered to address
these changes as they develop.
*Foresight, “The Future of Computer Trading in Financial Markets,” Final Project Report, Government Office of Science, London, 2012.
12
13. Electronic Trading
Benefits Investors
In a March 2013 market commentary review, Credit Suisse asked the question
“Is Increased Market Complexity Hurting?” and reached the following conclusions:
The market encompasses a wide variety of participants, including corporations, retail investors, broker-dealers, market
makers, hedge funds, liquidity providers, quants, fundamental investors, and index funds. Structural changes may affect
these entities in different, often indirect, ways:
• Computerization provides direct and less expensive market access for investors, while at the same time leaving
an electronic footprint.
• Market making became more sophisticated with improved technology, with spreads tightening and latency
increasing.
• Trade data grew in light of the smaller trade sizes, increasing both exchange revenue and routing costs.
The report concluded that computerization, technological advances, and small, more numerous trades have benefited
investors:
If the primary role of the market is the efficient transfer of capital in the economy – the ‘cost’ of trading, for real
investors, is a potentially important measure of progress (or lack there-of)…The US market trades around
$200bn/day, which equates to $50tr a year. One estimate indicates that around one-third of this is real investor
trading. As all trades are 2-sided, this would equate to $33tr in buying + selling per year. A conservative
estimate shows that the 30% improvement in [Credit Suisse’s ] Transaction Cost Index, at current levels of
trading, would translate to savings for real investors of over $10bn per year. On balance, the changes to the
market over the past decade seem to have made trading less expensive for all investors.*
*Credit Suisse, “How Much is Market Structure Hurting Investors?” Trading Strategy (March 13, 2013).
13
14. Electronic Trading
Benefits Investors
Eurex, a leading derivatives exchange, presented an analysis of the impact and
effect of high frequency trading based on its proprietary data at a February 2013
workshop.
Eurex’s findings were as follows:
• Technical advancements enabled European institutional investors to incur substantially lower transaction costs.
• HFT increased the liquidity resilience in benchmark futures.
• Little evidence supports the accusation that High Frequency Trading firms pursue front running of customer orders.
• While tighter spreads reduce Bid/Ask quantities and thus lead to a perception of reduced liquidity increased HFT
participation has actually increased liquidity.
• Most impressively, an interactive Eurex program recreated the total Bid/Ask, broken-down by HFT and non-HFT
orders at and away from the BBO, leading up to, during, and after its August 25, 2011, mini-flash crash. The data
showed that the initial shock was absorbed by a large number of buyers and that HFTs provided liquidity through
their purchases in falling markets.*
* “High Frequency Trading – a discussion of relevant issues,” Eurex: February 25-27, 2013.
14
15. Electronic Trading
Reduces Volatility
The Chicago Mercantile Exchange (CME), which operates a futures exchange, has stated: “…we
believe that automated trading contributes to market efficiencies, generally bolsters liquidity and
thereby contributes to the price discovery function served by futures markets.”* In recent years, the
average level of intraday volatility has been consistently lower than it had previously been.
Intraday Volatility for U.S. Equity Markets**
*CME Group, “What Happened on May 6?”, CME Group: May 10, 2010.
**Graphic: Credit Suisse, “Who Let the Bots Out? Market Quality in a High Frequency World,” Trading Strategy, March 19, 2012.
15
16. Expert Viewpoint - Electronic
Trading and Market Stability
A November 2013 white paper by European Central Bank scholars* noted:
“Our results provide no direct evidence that HFTs contribute directly to market instability in prices. To
the contrary, HFTs overall trade in the direction of reducing transitory pricing errors both on average
days and on the most volatile days during a period of relative market turbulence (2008-2009).”
*European Central Bank, “High Frequency Trading and Price Discovery,” November 2013.
16
17. Electronic Trading
Increases Liquidity
Technology has made investors and traders more agnostic to the source of orders. As trading
execution technology has become dramatically more efficient, the number of market participants has
increased significantly. These new market participants have obviated the need for traditional market
making.
*
*Graphic: Commentary, Traders Magazine Online News “Commentary: How High Frequency Trading Benefits All Investors,” March 17, 2010.
17
18. Electronic Trading
Reduces Trading Costs
Regulatory changes in markets and advancing technology have lessened fees and improved
execution speed and pricing reliability, to the benefit of the investing public. Financial intermediaries
now offer better service and more low-cost options for all investors who want to enter markets and
execute orders.
Graph, Left: Thomson Transaction Analytics, 2010.
Graph, Right: Byrne, “Elkins/McSherry -- Global Transaction Costs Decline Despite High Frequency Trading,” Institutional Investor:
November 2010.
18
19. Electronic Trading
Decreases Bid / Ask Spreads
Traders operating within the new automated markets, including high frequency traders, have replaced
manual market making by trading much more efficiently and at lower profit margins. This efficiency
has led to lower spreads, which is a cost-saving benefit to all investors.
Graphic: Angel et al., Equity Trading in the 21st Century, February 23, 2010.
19
20. Expert Viewpoint – HFT and
Price Efficiency
A November 2013 white paper from European Central Bank scholars stated:
“…we find overall that HFT’s facilitate price efficiency by trading in the direction of permanent price
changes and in the opposite direction of transitory pricing errors, both on average and on the highest
volatility days. This is done through their liquidity demanding orders”
“…there are times when prices deviate from their fundamental value due to price pressure and some
HFT’s demand liquidity to help push prices back to their efficient levels. This reduces the distance
between quoted prices and the efficient/permanent price of stock.”
*European Central Bank, “High Frequency Trading and Price Discovery,” November 2013.
20
21. Electronic Trading Improvements
and Risk Management
What do we know about high-frequency trading?
Charles M. Jones*
Summary of findings:
Based on the vast majority of the empirical work to date, automated and high frequency trading improves market
liquidity, reduces trading costs, and makes stock prices more efficient, although the data indicates that HFT may not be
as helpful in stabilizing prices during unusually volatile periods.
Over the past few decades, technology has transformed the trading of securities and other financial instruments.
While technology is the driver, it is clear that regulation has also contributed to the current automated market structure.
For example, the SEC’s Regulation NMS, adopted in 2005, provided strong incentives for trading venues to automate.
Market quality, including risk management, has improved because liquidity suppliers, based on the advancements in
market structure, are better able to adjust their activities in response to new information.
As all aspects of market-structure technology continue to advance, it is imperative to test critical software thoroughly.
Periodic regulatory reviews of critical aspects of market structure as needed, but those formulating policy should be
especially careful not to reverse the liquidity improvements of the last twenty years.
* Jones, Charles M., “What Do We Know About High-Frequency Trading?” March 20, 2013.
21
22. The Markets are Safeguarded
Through Regulation
MFA believes that regulations must keep pace with technological developments if we are
to safeguard our markets properly and protect investors. The SEC has taken a number
of steps to ensure that exchanges and investors are accountable for keeping markets
secure, fair, and stable.
SEC Chair Mary Jo White has stated*:
“There are clear benefits that flow from technology. It has created tremendous efficiency, and many have
seen significant improvements in trading costs and access to capital due to the technological revolution in
our market structure over the last 15 years. But systems can fail or operate in unexpected or unintended
ways. And the risk of that naturally increases as technology systems become faster, more pervasive, and
more complex.
“We all recognize that some risk of failure is inherent in any technology system. But that does not mean
we should not always be striving toward zero tolerance for errors and interruptions. We must address
these risks by striking the right balance of reliability, functionality, and cost.
“…We should not confuse these events as the byproducts of high-frequency trading or activity in dark
venues, as some often do. These events involved relatively basic, albeit serious, errors. Many could have
happened in a less complex market structure. But the persistent recurrence of these events can
undermine the confidence of investors and public companies in the integrity of the U.S. equity market
structure as a whole.”
22
* Excerpt from Chair White speech to Security Traders Association 80th Annual Market Structure Conference, Washington, D.C. October 2, 2013
23. The Markets are Safeguarded
Through Regulation
In August of 2012 while she was still Chair of the SEC, Former SEC Chairman Mary
Schapiro stated*:
“Reliance on computers is a fact of life not only in markets everywhere, but in virtually every facet of
business. That doesn’t mean we should not endeavor to reduce the likelihood of technology errors and
limit their impact when they occur.
…existing rules make it clear that when broker-dealers with access to our markets use computers to
trade, trade fast, or trade frequently, they must check those systems to ensure they are operating
properly.”
* SEC, “Chairman Schapiro Statement on Knight Capital Group Trading Issue.” August 3, 2012.
23
24. Electronic Trading is Subject to an
Extensive Regulatory Framework
U.S. regulators’ approach to oversight has historically been robust and continuous.
Regulators have recently taken several steps to keep pace with the advancements in
market technology and electronic execution automation. These new regulations are
designed to encourage competition, make opportunities available to all, and ensure
technological integrity in all market conditions. These rules apply to electronic trading,
algorithmic trading, and high frequency trading.
Recent Relevant Regulatory Actions in 2010-2013:
– Self-Regulatory Organizations Adopt a Circuit Breaker Rule (2010)
– SEC Adopts Modified Uptick Rule Subject to Circuit Breaker (2010)
– SEC prohibits “naked sponsored access” and adopts rule on “Risk Management Controls for
Brokers or Dealers with Market Access” (2010)
– Joint CFTC-SEC Advisory Committee on Emerging Regulatory Issues issue recommendations
in response of the market events of May 6, 2010 (2011)
– Self-Regulatory Organizations Adopt Amendments to the Circuit Breaker Rule (2011)
– Self-Regulatory Organizations Adopt a Limit Up-Limit Down Mechanism (2012)
– SEC Adopts a Consolidated Audit Trail Rule (2012)
– SEC proposes Regulation SCI to bolster “Systems Compliance and Integrity” (2013)
24
25. MFA Promotes Best Practices
for Electronic Trading
The MFA’s advocacy on market structure and electronic trading issues is based
on the following guidelines and best practices:
MFA believes strongly that efficient financial markets are vital for capital
formation, the growth of economies, and increases in the standard of living for
all individuals. At the core of efficient financial markets is the relationship
between regulators, free markets, and technology.
This relationship has allowed markets to experience reduced transaction costs,
greater volumes, faster execution rates, low latency in the transfer of critical
information, and has facilitated the inclusion of more market participants.
MFA believes that regulation is a continuous process and that regulators have
responded in a decisive manner to industry concerns - the resulting benefits to
market participants and market structure are undeniable.
More Information can be found here: MFA Letter to SEC Regarding Computer Trading and Risk Management Issues.
August 14, 2012 – ManagedFunds.org
25
26. References
Regulatory Agencies:
• The U.S. Commodity Futures Trading Commission (CFTC) – www.cftc.gov
• The U.S. Securities and Exchange Commission (SEC) – www.sec.gov
Other References:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
CFTC - Technology Advisory Committee working group draft definition of high frequency trading . October 2012.
“Chairman Schapiro Statement on Knight Capital Group Trading Issue.” SEC: August 3, 2012.
Concept Release on Equity Market Structure, SEC: January, 14, 2010.
“Commentary: How High Frequency Trading Benefits All Investors,” Traders Magazine Online News, March 17, 2010.
“Equity Trading in the 21st Century,” Angel et al., February 23, 2010.
“Elkins/McSherry -- Global Transaction Costs Decline Despite High Frequency Trading,” Institutional Investor:
November 2010.
“Findings Regarding the Market Events of May 6, 2010,” CFTC / SEC: September 30, 2010.
“Findings Regarding the Market Events of May 6, 2010,” CFTC / SEC: September 30, 2010.
Foresight, “The Future of Computer Trading in Financial Markets,” Financial Project Report, Government of Science,
London 2012.
“High Frequency Trading – a discussion of relevant issues,” Eurex: February 25-27, 2013.
Jones, Charles M., “What Do We Know About High-Frequency Trading?” March 20, 2013.
MFA Letter to SEC Regarding Computer Trading and Risk Management Issues. MFA: August 14, 2012
“Trading Strategy.” Credit-Suisse: March 19, 2012 and March 13, 2013.
Managed Funds Association
What Happened on May 6? CME Group: May 10, 2010.
www.managedfunds.org
@MFAUpdates
26