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Glossary

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There are 2 names in this directory beginning with the letter H.
High-Frequency Trading
High-frequency trading (HFT) is a trading strategy that uses computer algorithms that analyze and transact large numbers of trade orders in seconds. While high-frequency trading has been characterized by adding liquidity to the market and eliminating small bid-ask spreads this trading style has garnered criticism.
First, the liquidity that HFT is supposed to create only exists temporarily which means that it cannot be exploited for profit. Secondly, the algorithmic nature of the trading has occasionally resulted in unexpected large market sell-offs when massive orders trigger specific algorithm rules. Lastly, HFT is accused of benefiting institutional traders who take advantage of the algorithm to trade in large blocks, at the expense of smaller players. Watch Video


 

Hybrid Funds
Hybrid funds, also known as balanced funds or asset allocation funds, are funds that have more than one type of underlying asset class in their portfolios. Most types of hybrid funds hold a combination of stocks and fixed-income securities and will have an investment style on how to allocate the assets in its portfolio.