High-frequency or “fast” trading refers to trading strategies that execute thousands to millions of orders in fractions of a second. Leveraging powerful algorithms and colocated servers—often physically placed near exchange data centers—these systems minimize latency to gain speed advantages (wired.com).

Fast trade infrastructure depends on three core elements: ultra-low-latency networks (like fiber‑optic or microwave links), colocated data centers, and advanced algorithmic strategies ranging from statistical arbitrage to machine learning . By capitalizing on tiny price differences across markets, high-frequency trading firms can generate profits via sheer volume rather than large margins.

While high-frequency trading adds liquidity and narrows bid‑ask spreads, it also draws criticism. Events like the 2010 “Flash Crash” highlight how rapid order cancellations and quote-stuffing can destabilize markets within seconds (wired.com, investopedia.com). This has prompted regulators to scrutinize HFT practices and propose reforms.

In short, “fast trade” reshapes modern markets through technological innovation—boosting efficiency yet challenging stability and fairness.

ft.com