How Does Low Transaction Throughput Impact High-Frequency Trading of Derivatives?

Low transaction throughput is highly detrimental to high-frequency trading (HFT). HFT strategies rely on rapid execution of orders and near-instantaneous market data updates.

Low throughput leads to high transaction latency and congestion, causing orders to be delayed or fail. This results in significant slippage, missed opportunities, and the inability to maintain a competitive edge, rendering many HFT strategies unviable.