First of all, the overview of the two is different:

1. Overview of high-frequency trading: refers to computerized trading that seeks profits from extremely short-term market changes that people cannot take advantage of.

2. Overview of quantitative trading: it refers to the use of advanced mathematical models instead of manual subjective judgment, and the use of computer technology to select a variety of "high probability" events that can bring excess returns from huge historical data to formulate strategies.

Second, their roles are different:

1, the role of high-frequency trading: The speed of this kind of trading is so fast that some trading institutions put their "server groups" very close to the computers of the exchange to shorten the distance that trading orders travel at the speed of light through optical cables.

2. The role of quantitative trading: greatly reduce the impact of investors' emotional fluctuations and avoid making irrational investment decisions when the market is extremely fanatical or pessimistic.

Third, the characteristics of the two are different:

1, the characteristics of high frequency trading:

(1) High-frequency trading is a programmed transaction automatically completed by a computer;

(2) The volume of high-frequency transactions is huge;

(3) The holding time of high-frequency trading is very short, and there are many intraday trading times;

(4) The yield of each high-frequency transaction is very low, but the overall income is stable.

2, the characteristics of quantitative trading:

(1) discipline. Make decisions according to the running results of the model, not by feeling. Discipline can not only restrain human weaknesses such as greed, fear and luck, but also overcome cognitive bias and can be tracked.

(2) systematic. The specific performance is "three more". First, a multi-level model, including asset allocation, industry selection and specific asset selection; Second, from multiple perspectives, the core idea of quantitative investment includes macro-cycle, market structure, valuation, growth, profit quality, analyst's profit forecast, market sentiment and so on; The third is multi-data, that is, the processing of massive data.

(3) Arbitrage thought. Quantitative investment captures the opportunities brought by mispricing and mispricing through comprehensive and systematic scanning, so as to find out the valuation depression and make profits by buying undervalued assets and selling overvalued assets.

(4) Probability wins. First, quantitative investment constantly digs out the expected repetitive laws from historical data and uses them; The second is to win by combining assets, not by a single asset.

Baidu Encyclopedia-High Frequency Trading (Trading Strategy and Technology)

Baidu Encyclopedia-Quantitative Trading (Investment Method)