Technological change is as disruptive in financial markets as in any other. It creates new business models and threatens the profitability of established players, just as in the high street.
The rise of high frequency trading, powered by computer algorithms, is a case in point. Over the past five years, this has come to dominate trading, accounting for 60-80 per cent of volume, depending on the market. The high frequency traders have chased away the traditional market makers, and in doing so have substituted good liquidity for bad, according to some critics.
Read the rest here.
If you enjoy the content at iBankCoin, please follow us on Twitter
