1.Previous
3.Next

HFT firms do not consume significant amounts of capital, accumulate positions or hold their portfolios overnight. As a result, HFT has a potential Sharpe ratio (a measure of reward to risk) tens of times higher than traditional buy-and-hold strategies. High-frequency traders typically compete against other HFTs, rather than long-term investors. HFT firms compensate for low profit margins by executing extremely high volumes of trades, often numbering in the millions.

A

1.Previous
3.Next