Should high-frequency trading be banned?

Is the use of algorithms to execute trading strategies destabilising markets? With an FBI investigation on the cards, the stakes are high, says Simon Wilson.

What is high frequency trading?

It’s the use of powerful computers and trading algorithms ('algobots') to devise and execute trading strategies that rely on gaining a tiny edge over other investors and the market as a whole.

The many hedge funds, brokerages and specialist high frequency trading (HFT) firms that have sprung up since around the turn of the century use these complex computer programs to trade in and out of securities thousands [...]

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