Research On The Legal Regulation Of High-Frequency Trading In Securities And Futures Market

Since the computer technology is pullulating promptly,the "Internet plus finance" mode is gradually emerging,and it is in this mode that high-frequency trading emerges.In recent years,high-frequency trading has developed rapidly.After its initial application in the American market,financial markets in Europe and Asia have seen the emergence of it.HFT provides a lot of liquidity to the market,narrowing the bid-ask spread,but it also raises the question of whether HFT brings unfairness to the market and facilitates market manipulation.Therefore,the targeted regulations of HFT should balance the two aspects and should neither be left alone nor be excessively restrained.On August 16,2013,there was a problem when the proprietary business of Everbright securities' strategic investment department used its independent arbitrage system,which led to the repeated generation of a large number of out-of-expectation market price orders within 2 seconds and sent directly to the exchange.Some scholars believe that it was because the high-frequency arbitrage system that Everbright securities used failed to effectively verify this unexpected order that eventually led to the "Everbright wrong finger" incident,so high-frequency trading into the public eye.In 2017,Easton was convicted of market manipulation,which pushed high-frequency trading into the spotlight again.HFT is important in mature markets in Europe and the United States,but it is still in its infancy in China.With the continuous development of China's financial market,high-frequency trading may be used more and more in China's securities and futures market,but it can be seen from the above two cases that there are certain risks in high-frequency trading.Based on the above background,this paper studies the legal regulation of high-frequency trading.The text of this paper has been segmented into the following four chapters:Chapter one is "overview of high-frequency trading",introduces the notion and typical traits of HFT,and distinguishes the difference between HFT and its analogies.Secondly,this chapter introduces the main profit strategies of HFT and the value of HFT to the market.Finally,the development status of high-frequency trading in China is briefly described.The second chapter,"the regulatory necessity of HFT",elaborates the causes of regulating HFT from three aspects: the risks brought by HFT to the market,the market unfairness possibly caused by HFT,and the market manipulation convenience of high-frequency trading.The third chapter,"extraterritorial experience of HFT regulation",introduces the regulatory experience of HFT in overseas mature markets.From the analysis of overseas regulatory policies,the regulatory authorities' regulatory attitude towards HFT is appropriately limited,but not prohibited.Chapter four "the regulatory framework of HFT in China".This chapter firstly determines that the regulatory objective of high-frequency trading in China is the "three-legged theorem",and from the three perspectives of financial security,equity and efficiency respectively,it clarifies the key points of high-frequency trading supervision in China,among which it focuses on the analysis of the civil liability that the subject of high-frequency trading should bear.