April 1, 2014

Careful Speed Traders: ITG Unveils Anti-HFT Algo

By John D'Antona Jr.

Agency-only broker and technology firm ITG is now offering a new algorithm designed to thwart high-frequency traders and their strategies.

The new passive algorithm, called ITG Smart Limit, incorporates the smart-limit order logic of "SLimit" to help the buyside counter the effects of HFTs and to help buysiders better source liquidity.

SLimit is built on ITG's next-generation, low-latency trading infrastructure, providing powerful high-frequency trading technology to institutional investors. The ITG Smart Limit Algorithm employs sophisticated logic to determine optimal order pricing, sizing and routing to balance spread capture opportunities and adverse selection risk.

"ITG Smart Limit Algorithm enables institutional traders to compete effectively with high-frequency traders when supplying liquidity since it uses similar trading technology and techniques," said Jeff Bacidore, head of algorithmic trading at ITG. "Clients can use SLimit directly when working orders manually or indirectly when using an existing ITG algorithm."

SLimit is available via ITG's own Triton execution management system and also via FIX connection to ITG from third-party trading systems.

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