16 August 2017
visit www.avoka.com

Dutch regulators see positive side of HFT

10 December 2010  |  10011 views  |  0 Man writing graphs on glass wall

Dutch market watchdog AFM says it sees no grounds for restricting the use of high frequency trading (HFT), but warns that market participants and regulators must improve their operational and risk management techniques to deal with the complexity of computer-driven trading strategies

Following a study into the use of high-speed market trading, AFM says it sees HFT not as a separate strategy, but as a technique for applying short-term trading strategies that have been in use for years.

AFM says fragmentation of the European securities markets as a result of changes to the market structure has contributed to the growth of HFT.

"Using HFT, trading strategies can be implemented that provide liquidity on various trading platforms and that contribute to more efficient price formation for securities," says the regulator.

The AFM takes the view that automated trading methods like HFT have increased dependency on complex technical systems. It therefore argues that additional requirements should be set with regard to operational and risk management systems used by market participants throughout the trading chain.

It also calls for "a more intensive exchange of information" between international regulators and further harmonisation of European supervision.

"To be able to act effectively against possible illegal and/or undesirable behaviour by market participants, it is essential that regulators make additional investments in technological know-how, expertise and resources," says the report. "The information systems currently available in Europe are not adequate for supervisors to obtain a coherent and complete picture of the behaviour of individual players in the European capital markets."

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

UK government to study economic impact of High Frequency Trading

UK government to study economic impact of High Frequency Trading

24 November 2010  |  10919 views  |  0 comments
European Commissioner takes aim at HFT

European Commissioner takes aim at HFT

12 October 2010  |  8401 views  |  0 comments
CFTC ponders rules to combat high frequency disruptions

CFTC ponders rules to combat high frequency disruptions

08 October 2010  |  7854 views  |  0 comments
Finra hands out $2.3m fine as HFT crackdown begins

Finra hands out $2.3m fine as HFT crackdown begins

13 September 2010  |  11461 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
download the paper nowvisit www.dorsum.euvisit www.niceactimize.com

Top topics

Most viewed Most shared
Coinbase raises $100mCoinbase raises $100m
10122 views comments | 14 tweets | 14 linkedin
DBS Bank launches online car selling marketplaceDBS Bank launches online car selling marke...
9466 views comments | 13 tweets | 11 linkedin
China preps central clearing house for mobile payments providersChina preps central clearing house for mob...
9252 views comments | 8 tweets | 15 linkedin
HSBC automates documentary trade processing with IBMHSBC automates documentary trade processin...
8320 views comments | 6 tweets | 21 linkedin
Monzo appoints Curve co-founder Foster-Carter COOMonzo appoints Curve co-founder Foster-Car...
7786 views comments | 1 tweets | 2 linkedin

Featured job

Competitive base and bonus, plus benefits
London, UK

Find your next job