High-Frequency Trading (HFT) refers to trading activity where positions are opened or managed at a frequency that meets the HFT thresholds defined by Finotive Funding.
The specific HFT rule applies to Instant Funding Standard and Instant Funding Lite accounts.
When is HFT considered a violation?
High-Frequency Trading is prohibited where either of the following conditions is met:
1. Short Holding-Time Threshold
HFT may be identified where:
30% or more of closed trades have a holding time of less than 60 seconds; and
At least 10 closed trades have been completed before the assessment is made.
2. Five Consecutive Trades Within 10-Second Intervals
HFT may also be identified where:
Five (5) or more trades are opened consecutively; and
Each subsequent trade is opened within 10 seconds of the immediately preceding trade.
This criterion is assessed based on the time interval between each consecutive trade opening, rather than the total elapsed time between the first and fifth trade.
The five trades do not need to be opened within a single 10-second window. Instead, each new trade must be opened within 10 seconds of the trade immediately before it for the sequence to continue.
If the gap between any two consecutive trades exceeds 10 seconds, that continuous sequence is broken, and any subsequent trades will be assessed as part of a new sequence.
Therefore, the total time between the first and fifth trade may exceed 10 seconds while the trading activity can still meet the HFT criteria, provided that each consecutive trade in the five-trade sequence was opened within 10 seconds of the preceding trade.
Does the rule apply to manual trading?
Yes.
The HFT assessment is based on the trading activity and execution pattern, not on the method used to place the trades.