Faster is not always better. Who would want a doctor's appointment that lasted 30 seconds or a whisky that had been matured for a week? But when it comes to the stockmarket, the acceleration of high-frequency trading (hft) seems unstoppable. Trades on nasdao can be made in 250 microseconds, or one four-thousandth of a second.Liquidity is assumed to be good for capital markets. If investors know it is easy to sell their holdings, they will be more willing to buy. This will lead to a lower cost of capital for business and thus more investment in the economy, hft, which accounts for two-thirds to three-quarters of all Wall Street volume, seems to have led to smaller spreads (the gap between bid and offer prices).
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