Financial markets have undergone a deep reorganisation in the last 20 years. A mixture of technological innovation and regulatory constraints has promoted the diffusion of market fragmentation and high-frequency trading. In this blog, IFT PhD student Zihao Liu reports on the inaugural seminar in IFT’s Agora Seminar Series – “High frequency trading and networked markets” with Professor Rosario Nunzio Mantegna.

Due to the high-speed development of FinTech and technical innovations in recent years, the operation of the global financial market has changed beyond recognition. Ever more market participants are beginning to use powerful computer algorithms to execute and complete orders in mere microseconds. The new stock market has changed the traditional ecology of market participants and market professionals.

With the development of strategic trading decisions based on high-frequency trading, the fragmentation of markets has occurred. Contemporary stock markets are now “networked markets” where liquidity provision of market members has statistically detectable preferences or avoidances.

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