How is the price of gold established? In the futures or ETF market? And what role does high-frequency trading play a role in gold price discovery? Such are the questions academic Joerg Picard sought to answer in the first HFT academic study of the gold market based on millisecond data. One result of the study was a determination not only of HFT’s role in price discovery and commentary on the ETF market as a primary follower, but also the importance of institutional investors in gold price discovery was revealed. Gold price discovery: 12% of gold usage dedicated towards manufacturing The…
Do HFTs Drive Gold Prices?
Mark Melin
Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.