High net worth individuals rent stock exchange space for trading edge

HNIs have increasingly turned to co-location after pandemic

Rich traders are paying for servers close to the stock exchange system in order to benefit from faster execution.

 

The use of such co-location services, usually associated with sophisticated institutional investors, has become more common for high net worth individuals (HNIs) in recent years, according to market participants.

 

Co-location is useful for those using high frequency trading algorithms.

 

They can execute 400,000 orders or more in the time it takes a person to blink, according to a 2016 study.

 

Shaving off fractions of a second from the duration it takes an order to travel to the stock exchange can provide