{"id":222712,"date":"2025-04-24T12:59:01","date_gmt":"2025-04-24T16:59:01","guid":{"rendered":"https:\/\/ibkrcampus.com\/campus\/?post_type=glossary-terms&#038;p=222712"},"modified":"2025-04-24T15:53:21","modified_gmt":"2025-04-24T19:53:21","slug":"high-frequency-trading-hft","status":"publish","type":"glossary-terms","link":"https:\/\/www.interactivebrokers.com\/campus\/glossary-terms\/high-frequency-trading-hft\/","title":{"rendered":"High-Frequency Trading (HFT)"},"content":{"rendered":"\n<p>High-frequency trading (HFT) is a subset of algorithmic trading that uses powerful computers and AI algorithms to execute large volumes of trades at extremely high speeds\u2014often in microseconds. The goal of HFT is to profit from small price movements that occur within fractions of a second.<\/p>\n\n\n\n<p>AI plays a crucial role in HFT by enabling systems to quickly analyze market data, identify trading opportunities, and execute trades faster than human reaction times. For example, an HFT firm might exploit a temporary price discrepancy between two exchanges, buying on one and selling on the other within milliseconds.<\/p>\n\n\n\n<p>While HFT contributes to market liquidity and price efficiency, it also raises concerns about market manipulation, fairness, and systemic risk. Events like the 2010 Flash Crash, where markets plunged and recovered in minutes, have been partially attributed to HFT dynamics, prompting regulatory scrutiny.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>High-frequency trading (HFT) is a subset of algorithmic trading that uses powerful computers and AI algorithms to execute large volumes of trades at extremely high speeds\u2014often in microseconds. <\/p>\n","protected":false},"featured_media":0,"parent":0,"template":"","meta":{"_acf_changed":false,"footnotes":""},"traders-glossary":[13272,13278,13251],"class_list":{"0":"post-222712","1":"glossary-terms","2":"type-glossary-terms","3":"status-publish","5":"traders-glossary-trading-terms-h","6":"traders-glossary-ibkr-traders-glossary","7":"traders-glossary-trading-alphabet"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO 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