High-Frequency Trading and its Impact on Market Liquidity: A Review of Literature

Oğuz ERSAN; Nihan DALGIÇ; Cumhur Enis EKİNCİ; Mehmet BODUR

doi:https://doi.org/10.29023/alanyaakademik.799039

Makale detayları

High-Frequency Trading and its Impact on Market Liquidity: A Review of Literature

Yazarlar:

Oğuz ERSAN | Nihan DALGIÇ | Cumhur Enis EKİNCİ | Mehmet BODUR

Yayıncı:

Alanya Alaaddin Keykubat University

Ana Başlıklar:

Genel yönetim

Dergi:

Alanya Academic Review 2021 Vol.5 Issue 1, pp.345-368

Belge Tipi:

Makale

Yayın Tarihi:

1/2021

Belge Dili:

İngilizce

Document ID (Org No.):

2000846380

Sıklık:

Üç Yıllık

eISSN:

2651-4192

DOI:

https://doi.org/10.29023/alanyaakademik.799039

Anahtar kelimeler:

Özet:

 

High-frequency trading (HFT) has been dominating the activity in developed financial markets in the last two decades. Despite its recent formation, the literature on the impacts of HFT on financial markets and participants is broad. However, there are ongoing debates and unanswered questions within many subtopics. We survey through the research towards HFT effects on liquidity in an attempt to explain the coexistence of evidence regarding both the positive and the negative impacts of HFT. We name two main factors leading to mixed results. Former concerns the negative market conditions such as intraday shocks, through which HFT trading patterns may sharply change. Latter regards the certain characteristics of HFT liquidity provision with the potential to present externalities for the market.

 

High-frequency trading (HFT) has been dominating the activity in developed financial markets in the last two decades. Despite its recent formation, the literature on the impacts of HFT on financial markets and participants is broad. However, there are ongoing debates and unanswered questions within many subtopics. We survey through the research towards HFT effects on liquidity in an attempt to explain the coexistence of evidence regarding both the positive and the negative impacts of HFT. We name two main factors leading to mixed results. Former concerns the negative market conditions such as intraday shocks, through which HFT trading patterns may sharply change. Latter regards the certain characteristics of HFT liquidity provision with the potential to present externalities for the market.

Makale detayları

High-Frequency Trading and its Impact on Market Liquidity: A Review of Literature

Yazarlar:

Oğuz ERSAN | Nihan DALGIÇ | Cumhur Enis EKİNCİ | Mehmet BODUR

Yayıncı:

Alanya Alaaddin Keykubat University

Ana Başlıklar:

Genel yönetim

Dergi:

Alanya Academic Review 2021 Vol.5 Issue 1, pp.345-368

Belge Tipi:

Makale

Yayın Tarihi:

1/2021

Belge Dili:

İngilizce

Document ID (Org No.):

2000846380

Sıklık:

Üç Yıllık

eISSN:

2651-4192

DOI:

https://doi.org/10.29023/alanyaakademik.799039

High-frequency trading

HFT

Liquidity

Intraday shocks

Extreme price movements

Sayı

Makale detayları

High-Frequency Trading and its Impact on Market Liquidity: A Review of Literature

Yazarlar: Oğuz ERSAN | Nihan DALGIÇ | Cumhur Enis EKİNCİ | Mehmet BODUR

Yayıncı: Alanya Alaaddin Keykubat University

Ana Başlıklar: Genel yönetim

Dergi: Alanya Academic Review 2021 Vol.5 Issue 1, pp.345-368

Belge Tipi: Makale

Yayın Tarihi: 1/2021

Belge Dili: İngilizce

Document ID (Org No.): 2000846380

Sıklık: Üç Yıllık

eISSN: 2651-4192

DOI: https://doi.org/10.29023/alanyaakademik.799039

High-frequency trading

HFT

Liquidity

Intraday shocks

Extreme price movements

Sayı

Yazarlar:

Oğuz ERSAN | Nihan DALGIÇ | Cumhur Enis EKİNCİ | Mehmet BODUR

Yayıncı:

Alanya Alaaddin Keykubat University

Ana Başlıklar:

Genel yönetim

Dergi:

Alanya Academic Review 2021 Vol.5 Issue 1, pp.345-368

Belge Tipi:

Makale

Yayın Tarihi:

1/2021

Belge Dili:

İngilizce

Document ID (Org No.):

2000846380

Sıklık:

Üç Yıllık

eISSN:

2651-4192

DOI:

https://doi.org/10.29023/alanyaakademik.799039