Fed Warns High-Frequency Trading Firms

Fed warns high-frequency trading firms

Fed warns high-frequency trading firms

By Arash Massoudi in New York and Philip Stafford in London

Many high-frequency trading firms are taking shortcuts in their risk controls as they seek out faster ways to trade, a US regional Federal reserve bank has warned.

The study by the Federal Reserve Board of Chicago found many high-speed traders were relying on others to catch an out-of-control algorithm or erroneous trade and called for controls to be tightened.

The findings come as US regulators look to shore up a crisis of confidence in domestic markets after a string of incidents in recent years stemming from the reliance on algorithms for trading.

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About yocijourney

God does not play dice
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