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The business of HFT

∞structural

The economics behind the maths: fixed cost versus thin margin, the research-to-production pipeline, who is in the flow, and whether a one-person shop is viable in 2026.

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What's in this topic

4 pages, each linking down to the ideas inside it.

Research-to-production pipeline01
Idea → backtest → paper trade → live, with risk gates at every step. The pipeline is where most edges die, and where they should die, cheaply, before they cost real money.
∞structural
The economics of HFT02
High fixed costs, vanishing per-trade margins, and revenue far below the 2009 peak. Understanding the cost structure tells you which strategies and venues can still pay.
∞structural
Market participants03
Who is in the flow: market makers, prop HFT firms, agency execution, institutions, and retail. Knowing whose order you’re likely trading against is half of adverse selection.
∞structural
Going independent in 202604
Why a one-person shop is conceivable now: two of the three arenas have low access barriers and gettable data, and AI tooling has collapsed the cost of building the stack. Hard and capital-constrained, but real.
◆still alpha

Where this fits

↔ Across · composes with Systems & building ↔ Across · composes with Performance & capacity ↔ Across · composes with Trading strategies → Apply · makes money in Going independent in 2026 → Apply · makes money in Markets ⤓ Build / Buy · tool needed Datasets & tools