What is High Frequency Trading (HFT) in Prop Firms?

The Rise of HFT

High Frequency Trading (HFT) strategies use algorithms to execute trades in milliseconds. Some prop firms have started allowing HFT for passing challenges, though restrictions often apply to funded accounts.

Pros of HFT

The main advantage is the speed of passing. HFT bots can often hit profit targets in a matter of minutes during high volatility.

Cons and Risks

Not all firms allow HFT. Using it on a restricted firm will lead to an immediate ban. Furthermore, HFT strategies rarely work on live funded accounts due to slippage and spread differences.

Conclusion

If you plan to use HFT, ensure the firm explicitly allows it and understand the transition rules to the funded stage.