New algorithmic trading firms are ascending and High Frequency Trading (HFT) has become a strategy for investment opportunities of all kind. The process consists of predictive selling and buying of contracts using algorithms in trading software. Many financial regulations have lead to changes in the financial system, especially because of the crisis in 2008. Many people have lost their jobs and many faced the value of their assets being plummeted below.

High Frequency Trading (HFT) is viewed by many in different ways. Non-technology traders are confused with the advantage that automated trading firms have. More than that, they are also affected by the fall in profit earning because of the revenues that High Frequency Trading (HFT) generate. It is simply a trading strategy, where algorithms are used on advanced servers to see exactly the trends in market, to analyze them and to place orders in less than a second. High volumes are involved; even the trade is just done in a few seconds.

Due to this, firms have new possibilities, such as access to high volume information and make profit by reselling. Back in the days, FX market also placed orders over the telephone, but with the High Frequency Trading (HFT), everything is done electronically and FX markets can handle high volume trade. For developing the High Frequency Trading (HFT) strategies, Forex market’s intrinsic feature of low volatility and liquidity provide the right environment.

High Frequency Trading (HFT) has an important role in FX marketplaces and a BIS report states there is an increased usage of HFT in FX markets and now there is even a larger infrastructure available for such an electronic trading. It relies on small orders and operating high volume, which maintains low margins and low latency as well. Just in a matter of milliseconds, all orders can be placed and withdrawn. Algorithms are behind such a strategy and they have the ability to accomplish more. There is another trend that seems to catch up and it refers to traders adopting short risk holding periods to increase efficiency, all in less than five seconds.

After the Great Depression, financial regulation has been changed in order to cope better with the newest trends. In their place, newer financial regulation has been established, focusing more on how businesses are managed. But these regulations need a lot of documentation of how policies and procedures are operating, and with rigorous testing to ensure compliance with them. During the recent economic situation, it is important to note that many financial organizations which had detailed documentation and procedures in order, have collapsed.

There are many controversial opinions regarding the financial regulation that would turn out to be the most suitable. Some say that new regulations are needed to help strengthen the financial system. The current ones are clearly not very effective, but the new ones can be difficult to implement. A separation of commercial and investment banking would be suitable, and it was in effect at some point.

Technology development can be seen in every industry, including trading. In the financial world, High Frequency Trading (HFT) http://www.thetradetechblog.com/category/high-frequency-trading/ has been making notable progresses. When it comes to financial regulation http://www.thetradetechblog.com/category/financial-regulation/ there are still a lot to be done, as finding a common point is rather difficult.