Economy
The Evolution of Fast Trading Techniques
Within the last few decades, the world of stock trading has radically evolved—from a pace of execution measured in minutes to milliseconds. As traders strive to capitalize on market opportunities that may only exist for a few seconds, they will continue to evolve rapid trading techniques to meet the demands of today’s fast-moving financial markets. As technology continues to reshape the contours of financial markets, traders entertain ever-innovative ways that truly equip them to engage in rapid trading at unmatched speeds.
Staying abreast of developments is thus paramount to success. Resources such as Exness Insights help them get all the information they need on the latest trends and technologies in rapid trading—to afford them a deeper understanding of the mechanics behind trading today.
This article looks at the evolution of high-speed trading practices—from the manual handling that first inspired speed traders to today’s high-frequency trading, plus other common techniques.
The Early Days of Rapid Trading
Until the technological revolution, stock trading was entirely manual in nature, wherein traders needed to be physically present on the floor of the exchange and call out orders. It would take minutes or more at times to execute the trades, often depending on the trader’s capability of moving fast and viewing emerging opportunities in real time.
It was only natural that once computers came into use in the 1970s and 1980s, the first automatic trading systems should have begun to make their appearance.
Developers created the early generations of automatic trading systems to assist traders by processing orders electronically, which increased speed and efficiency.
The Emergence of High-Frequency Trading
High-frequency trading as a major innovation came into being through the late 1990s. Algorithms and super-fast technology form the basis of systems that can execute thousands of trades in just a second. High-frequency trading systems generally hunt for minute price disparities in the market. A well-designed, super-fast computer-based high-frequency trading system can process gargantuan amounts of data with order executions in milliseconds.
Using very small changes in price, high-frequency traders take advantage by executing trades faster than human traders could react to. That, in turn, uses a sophisticated infrastructure of low-latency data connections and colocated servers near the stock exchanges for the least possible delay. It is because of this that HFTs are so speedy; traders can exploit opportunities across multiple markets simultaneously, creating more liquidity and therefore a more efficient market altogether.
With great power comes great controversy, though, as the rise of HFT has brought with it a number of concerns regarding market volatility. The sheer number of trades in such a short span can create wild variances in stock prices.
Algorithmic Trading and Scalping Strategies
The most widespread algorithmic trading style is scalping, whereby the trader executes numerous trades throughout the day, each intended to take advantage of tiny movements in prices. Scalpers rely on fast execution and high levels of liquidity to enter positions that could last several minutes or even mere seconds while collecting minuscule profits on each trade.
Algorithmics and scalping trading have both become indispensable parts of rapid trading strategies. Those traders who will be able to master this technique stand to gain from the fast pace of today’s financial markets, where speed and precision are of essence.
The Future of Rapid Trading Technique
As technology progresses, the forward motions of rapid trading will only continue to accelerate and evolve further. Today, artificial intelligence and machine learning are already embedded in trading algorithms, enabling traders to predict market movements with far greater accuracy than ever before. Consequently, through vast amounts of historical data, pattern identification provides AI-powered trading systems with real-time decisions unreachable by humans.
Another sphere that might highly influence the increasing speed—and therefore effectiveness—of rapid trading is quantum computing. Quantum computers can process information at speeds that are exponentially higher compared to conventional computers, which means that the execution speed of the trade will go up, and traders will be in a position to analyze market conditions in great depth until now not achieved.
Outpacing the Competition in Rapid Trading
In rapid trading, an individual’s success largely depends on how informed and flexible they can be. With the continuous evolution in technology, it means that traders have to keep innovating strategies to compete with the increasingly rapid motion of the markets. Properly understanding the history of rapid trading, from the purely manual processes through to today’s sophisticated algorithms, gives a number of insights helpful for traders to keep their efficiency high in a competitive, swift environment.
This would require the proper tools and timely updates on development so that traders could stay ahead of the game and take advantage of the possibilities of rapid trading.
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
By Adedapo Adesanya
The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.
At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.
It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.
Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.
Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.
Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.
“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.
Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.
If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.
Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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