Today’s high frequency trading models execute enormous trading volume in response to short-term market trends. Thus, huge price shifts are now more possible and frequent than ever before. In the realm of high frequency trading, timing is literally everything.
To execute profitable securities trades on a timely basis, institutional and small individual traders alike require accurate real-time news feeds. Dow Jones is among the premier providers of elemental, low-latency news formats that facilitate efficient HFT models.
Enter the Dow Jones Lexicon
To maximize market cycles, HFT firms and experts must be aware of overall market direction not just its present position. The Dow Jones Lexicon facilitates the effectiveness of high frequency trading models with news oriented toward lower-latency trends to uncover hidden opportunities that ordinary HFT algorithms miss.
Most high frequency trading models merely assign relevant news stories an overall arbitrary “sentiment score.” The Dow Jones Lexicon reviews current and archived news objectively and quantitatively. Real-time news reports are assigned relative sentiment scores on a per-word basis. Overall sentimentality, litigious potential, and sentiment are then evaluated based upon usage frequency. These data are then utilized for generating the objective criteria that drive HFT models.
Custom-tailored technology for today’s automated trading networks
The Dow Jones Lexicon offers unique flexibility in meeting contemporary trading professionals’ needs. With the DJL, trading platforms and professionals may devise custom-leveraged dictionaries and internal proprietary research while simultaneously employing DJL-processed news content. The DJL is conveyed as an XML real-time feed or a single data batch at close of the trading day. It is also available as a Dow Jones News and Archives add-on program.
Such features are essential for maintaining the overall competitive edge of high frequency trading models. Without the unique advantages of speed and opportunity seizure, the essential purpose of HFT models is largely defeated. DJL fills this void quite fully.
The future of High Frequency Trading Models
Of date, roughly 70 percent of all securities exchanges are conducted via high frequency trading platforms. In essence, automated trades are executed by computers that are pre-programmed to follow certain trends by sheer inertia. When trends change, however, HFT models also adjust automatically.
High frequency trading models may be likened to flying an aircraft on autopilot mode. All goes well with smooth sailing, unless one encounters an air pocket or other atmospheric disturbance. Should such eventualities materialize, direction can be altered quite rapidly. Hence, the major securities market movement induced by HF
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