What is "High Frequency Trading" (HFT)?

High Frequency Trading (HFT) is a trading strategy based on the use of powerful algorithms to execute a large number of transactions in very short timeframes. This allows traders to profit from even the smallest market fluctuations by holding positions for mere fractions of a second. High-speed computing and optimized network connections play a crucial role in HFT. This trading environment requires advanced technology and significant investments. Despite the controversy, HFT is widely used on major exchanges, where even the slightest speed advantage can generate millions of dollars in profit.