BlueCrest Capital's "lightning-fast" trading advantage

December 13th, 2009
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With the competition for lightning-fast trades growing, European stock markets have begun to set up large data centers where hedge funds can set up in order to cut lag time accumulated from trading across geographic distances. According to Reuters, high-frequency trading accounts for some 60% of equity market volume in the US and is estimated at almost 45% in Europe.

One of the leaders in high-frequency trading is UK’s BlueCrest Capital Management. BlueCrest’s trading technology helped bring in strong returns during the crisis, one of the few funds to do so amongst record industry losses. Of its $15 billion in assets under management, 60% of it is traded in BlueCrest’s systematic trading strategies. The strategy relies on software programs and infrastructure built by PhD’s employed by the firm. The software is triggered to issue large volumes of trades every day. By making tens of thousands of trades daily, BlueCrest is able to move in and out of the market in seconds, exploiting short-lived price differences to make small gians that add up to solid returns.

Mark Holt, Technology Commander-in-chief said in an interview with Reuters, “There’s an arms race going on-what took 10 milliseconds now takes 10 microseconds…” but he continued to comment that the goal for BlueCrest is to build a model that is not only faster but smarter as well.
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For Detailed Investor Profiles on these Investors, click below:
BlueCrest Capital Management
Related People: Michael Platt; William Reeves
Related Entities: BlueCrest Capital; BlueCrest Special Situations Fund LP; BlueCrest Strategic Ltd; BlueMountain Capital Management; Man Group Holdings
Related Article Tags: Investment Management, Fund Manager and General Financial News


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