When it comes to Fund management & scalability … HFT Fails?
“HFT in my experience falls under one asset class in which you can manage some percentage of funds with higher returns than Index” – By Lokesh Madan
“HFT Return depends not only on strategies it depends upon the continuous effort in Technology upgradation” By Lokesh Madan.
In India I meet so many Top broker HFT Desk their return in HFT is not so consistent. When they invested in High end technology & develop their own In house Low latency Order management Engine they get more than 50% return per annum. If they constantly not upgrading their technology then their return tempered& goes down with in range of 25 – 30%. But HFT asset class is not scalable that’s the main problem I see, If you have 500 Cr of fund & want consistent 50% return using HFT strategies then it can not be possible in India atleast.
If you fall under top five lowest possible latency solution with you (Under 10 Micro second Tick to Trade “Not Exchange calculation take into account”) then you get return of 80 – 100% per annum. But from last two years that shift with in 6 months time i.e
Top Performer in Terms of In-house Developed Broker from India.
2008 – 2010 – Open Future
2010 – 2012 – OPG
(From 2012 Onwards Broker start investing on In house development .Aggressively. So due to that competition increase & now no one stand more then 6 months in Return range of above 50% ).
2012 – 2013 – CNB Securities Delhi & Dolat capital Mumbai
2013 – 2013 – Adroit comes in to play But Lifespan was not more then 6 months
2013 end till – Pace security comes into picture.
As I told you in start no one constantly investing in technology upgradation.
“2013 FPGA comes into picture at NSEIndia by various vendors but most of them falls. Currently best lowest possible Latency is still achieved by using one In house developed Software in India.”
HFT strategies have Fund deployment constraints.
MD Algo Trading India LLC
MD StartUp Seed Funding Capital Limited
3 Replies to “High Frequency Trading Facts : Indian Markets”
HFT is mordern day farce it destabilizes market and is blatant theft. it should be banned. i think you should look at research done By NANEX which point out the true picture of HFT’s.
No its a marketaker no blatent theft you don’t know or you are juat unhappy with the part of money making its rising the markets over time as this is the only market with unbelivable potential and possibilities
Latest FPGA based HFT trading platform can give even less than 1 micro second tick to trade latency. The biggest challenge in using FPGA based HFT trading platform is one needs people with good understanding of trading strategies used in market as well as how to do FPGA programming. The time critical components of the trading algorithms should be placed within same FPGA to reduce computation time. Also if the algorithm involves memory transaction design consideration should be taken so that the computation logic should not starve due to fetching of data from memory. Creation of right sized cache and cache management is a critical component of effective implementation of trading strategies on FPGA platform