If you have more than a passing interest in the stock market, you will be aware that the hot topic on everyone’s lips these days is high frequency trading (HFT). There’s a lot of debate about high frequency trading at the moment, with the practitioners themselves on one side of the fence and the regulators and more traditional investors on the other.
Whichever way you look at it and whichever side of the fence you are on, there is no denying the fact that HFT has been through an explosion in growth over the last few years, so that now, according to some statistics, it accounts for up to 80% of the volume of the US stock market.
It is interesting that the biggest stock exchanges like NYSE Euronext, Nasdaq OMX and in the London Stock Exchange in UK are now receiving an unprecedented number of applications from new firms, setting themselves up as high frequency trading specialists.
These specialists are either coming from bigger investment banks like Goldman Sachs and JP Morgan, or from hedge funds who have previously specialized in quantitative trading. With the recent proposals that will ban those firms from conducting both proprietary trading and client business, it is maybe no surprise that so many new HFT shops are starting up.
In addition to this, venture capitalists and private equity firms are also getting in on the act, setting up new operations with quantitative developers straight out of college. So if you are currently studying any kind of quantitative engineering at a top school like MIT for example, you might have a pretty lucrative career ahead of you.
And if you have any kind of experience of working on high frequency trading systems, then you should have no problem finding an opening where you can use your skills in this brave new world.