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What Kind of Data Analysis Is Used by CEX Surveillance to Flag Potential Front-Running?

Surveillance analyzes trade correlation, timing, size, and profitability of internal trades that immediately precede large client orders to detect front-running.
Greeks.Live14.11.25

What Kind of Data Analysis Is Used by CEX Surveillance to Flag Potential Front-Running?

CEX surveillance systems employ sophisticated algorithms to look for suspicious correlations. They flag employee trades or proprietary trades that consistently precede large client orders and profit from the subsequent price movement.

They analyze order submission times, trade sizes, and the profitability of the preceding trade relative to the client's order. Unusually high trading volume or rapid price changes immediately following an internal trade can also be a red flag.

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