{"id":10655,"date":"2025-04-03T08:21:20","date_gmt":"2025-04-03T06:21:20","guid":{"rendered":"https:\/\/insights.ieseg.fr\/?p=10655"},"modified":"2025-04-03T08:22:15","modified_gmt":"2025-04-03T06:22:15","slug":"finance-high-speed-trading","status":"publish","type":"post","link":"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/","title":{"rendered":"Finance: high-speed trading"},"content":{"rendered":"\n<p>The old saying that \u2018time is money\u2019 has never been truer than in the world of High-Frequency Trading (HFT), where transactions are concluded in micro or nanoseconds. <a href=\"https:\/\/insights.ieseg.fr\/en\/resource-center\/expert\/paolo-mazza\/\">Paolo MAZZA<\/a>, professor of finance at I\u00c9SEG and Head of the Asset and Risk Management major (PGE Masters), takes a closer look at a practice that is as widespread as it is controversial.<\/p>\n\n\n\n<h2>What is high frequency trading?<\/h2>\n\n\n\n<p>HFT is a bit of a catch-all term, but by definition its principle is based on speed. It\u2019s not a long-term investment: you don\u2019t bet on the growth of companies, you don\u2019t capitalise on a sector, you aim for a monetary gain on quick buy and sell positions.<\/p>\n\n\n\n<h2>Technically, how does it work?<\/h2>\n\n\n\n<p>As finance is undoubtedly the most fertile ground for implementing new technologies, stock market players did not wait for AI to automate the match between supply and demand: computerised order execution has been practised since the 1970s.<\/p>\n\n\n\n<p>However, the spread of highspeed broadband has made it possible to access much faster execution speeds throughout the world. But the key to gaining a decisive advantage is to be as close as possible to the heart of the exchange\u2019s central server. Trading firms are investing a lot of money to be as close as possible to the exchanges. Being able to rely on a few metres of fibre optic cable rather than several kilometres makes all the difference. As for AI, it doesn\u2019t really change the game in terms of physical architecture or network operation, but it does speed up information processing.<\/p>\n\n\n\n<p><strong>Read the full article&nbsp;<\/strong>in the&nbsp;latest edition of Change Magazine (\u201cTime is indefinable\u201d):<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-issuu wp-block-embed-issuu\"><div class=\"wp-block-embed__wrapper\">\n<iframe title=\"&quot;Change - A new way of talking business&quot; I\u00c9SEG Magazine - Issue #10\" src=\"https:\/\/e.issuu.com\/embed.html?u=ieseg&#038;d=changemagazine-feb2025-issue10&#038;pageNumber=14\" style=\"border:none; width: 1304px; height: 1000px;\" allow=\"clipboard-write,allow-top-navigation,allow-top-navigation-by-user-activation,allow-downloads,allow-scripts,allow-same-origin,allow-popups,allow-modals,allow-popups-to-escape-sandbox,allow-forms\"  allowfullscreen=\"true\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p><em>This magazine aims to be an information tool, thanks to the range of expertise of our professors and the informed opinions of our professional partners in relation to current themes. This tool aims to deliver ideas and reflections to its readers, in order to cultivate their daily lives and their perception of the challenges facing the companies of today and tomorrow.<\/em><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p>Paolo Mazza is a Professor of Finance at I\u00c9SEG School of Management where he teaches global finance, data analytics and visualization, as well as trading &amp; exchanges courses. Before holding this position, he was an ARC Postdoctoral fellow at the Louvain School of Management (Universit\u00e9 catholique de Louvain). <\/p>\n","protected":false},"excerpt":{"rendered":"<p>The old saying that \u2018time is money\u2019 has never been truer than in the world of High-Frequency Trading (HFT), where transactions are concluded in micro or nanoseconds. Paolo MAZZA, professor of finance at I\u00c9SEG and Head of the Asset and Risk Management major (PGE Masters), takes a closer look at a practice that is as <a href=\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\" class=\"more-link\">&#8230;<span class=\"screen-reader-text\">  Finance: high-speed trading<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":10656,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[484],"tags":[326,1576,268,448],"article-type":[12],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v19.5.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Finance: high-speed trading<\/title>\n<meta name=\"description\" content=\"The saying that \u2018time is money\u2019 has never been truer than in the world of High-Frequency Trading, where transactions are concluded in micro or nanoseconds.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Finance: high-speed trading\" \/>\n<meta property=\"og:description\" content=\"The saying that \u2018time is money\u2019 has never been truer than in the world of High-Frequency Trading, where transactions are concluded in micro or nanoseconds.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\" \/>\n<meta property=\"og:site_name\" content=\"I\u00c9SEG Insights\" \/>\n<meta property=\"article:published_time\" content=\"2025-04-03T06:21:20+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-04-03T06:22:15+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/insights.ieseg.fr\/wp-content\/uploads\/2025\/04\/stock-5051155_1280.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"873\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Andrew MILLER\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Andrew MILLER\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\",\"url\":\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\",\"name\":\"Finance: high-speed trading\",\"isPartOf\":{\"@id\":\"https:\/\/insights.ieseg.fr\/#website\"},\"datePublished\":\"2025-04-03T06:21:20+00:00\",\"dateModified\":\"2025-04-03T06:22:15+00:00\",\"author\":{\"@id\":\"https:\/\/insights.ieseg.fr\/#\/schema\/person\/3d9d5305d4471a7c4bf3fa7bda0d004f\"},\"description\":\"The saying that \u2018time is money\u2019 has never been truer than in the world of High-Frequency Trading, where transactions are concluded in micro or nanoseconds.\",\"breadcrumb\":{\"@id\":\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/insights.ieseg.fr\/en\/resource-center\/economics-finance\/finance-high-speed-trading\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"I\u00c9SEG Insights\",\"item\":\"https:\/\/insights.ieseg.fr\/en\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Economics &amp; 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