Computer-based market trading 'beneficial'

Man looking at trading screen Sir John said the report's key message was "mixed"

Related Stories

A government study has found no direct evidence computer-based financial trading has led to increased volatility or abuse of the market.

It says algorithmic trading, automated systems for buying and selling securities, can be beneficial.

And high-frequency trading, when the assets are held for as little as a few seconds, may have modestly improved the functioning of markets.

But the report adds it could lead to instability in specific circumstances.

And it calls for action, including more surveillance and research, to reduce that risk.

The government's chief scientific adviser Sir John Beddington, who led the research, said its key message was "mixed".

"Policy makers are justified in being concerned about the possible effects of HFT [ high-frequency trading] on instability in financial markets," he said.

Computer-driven trading has been widely blamed for what was called the "flash crash" in New York in May 2010. Wall Street's Dow Jones index lost and then regained about 600 points within half an hour.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories



  • Mukesh SinghNo remorse

    Delhi bus rapist says victim shouldn't have fought back

  • Aimen DeanI spied

    The founder member of al-Qaeda who worked for MI6

  • Before and after shotsPerfect body

    Just how reliable are 'before and after' photos?

  • Lotus 97T driven by Elio de AngelisBeen and Gone

    A champion F1 designer and other notable losses

  • A poster of Boris Nemtsov at a rally in St Petersburg, Russia, 1 MarchWho killed Nemtsov?

    Theories abound over murder that shocked Moscow

Try our new site and tell us what you think. Learn more
Take me there

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.