HFT (High Frequency Trading) Effects on Investors

4. An Increase in Liquidity

It may seem as though high frequency trading has quite a bit of doom and gloom surrounding it from a retail investor’s perspective, but in reality, there are some benefits. The algorithmic advantage used by high frequency traders allows intermediaries the ability to pair buyers and sellers in an unheard of speed. This increases the overall liquidity of the market, making it easier for pension funds, mutual funds, and individual investors to buy and sell stocks at a reasonable price.