High-frequency trading is a branch of algorithmic trading that focuses on generating profit using high execution speed. It’s used in areas such as arbitrage trading, signal-based trading, and scalping. In major exchanges, the trading volume generated from these trades – typically by proprietary traders, hedge fund managers, and market makers – is significant.

Developing high-frequency trading strategies requires intraday tick data and a solid analytical tool. MATLAB^® provides both. It supports popular techniques for efficiently developing, backtesting, and implementing these strategies:

• Hypothesis testing, machine learning, and pattern recognition
• Trading cost analysis and market impact modeling
• Analysis of financial time series to generate trading signals
• Monte Carlo simulation and model validation
• High-performance parallel computing using GPUs, clusters, grids, and clouds

For more on tools for high-frequency trading, see MATLAB, Datafeed Toolbox™, and Trading Toolbox™.