The Government Office for Science has launched an investigation into how the role of computer generated trading in financial markets will evolve in the future.
The Foresight project, ‘The Future of Computer Trading in Financial Markets’, aims to explore the role of the technology in the next few decades, and how its evolution will affect issues such as financial stability, regulation, integrity of financial markets, competition and the future role and location of capital markets.
It will also assess the possible challenges of the system, as well as the opportunities offered by new computer technologies the financial sector could adopt.
Professor Sir John Beddington, government chief scientific adviser, will be heading up the research project, which is sponsored by the Treasury.
“It is essential to develop a better understanding of how computer trading in financial markets might evolve, in order to help protect the UK and other economies against technology-led economic instabilities,” he said.
An international high-level stakeholder group will be appointed to steer the direction of the project, which will be chaired by Mark Hoban, financial secretary to the Treasury.
The group will also involve senior representatives from organisations in the public and private sectors, and the research community.
Current members of another group, whose task is to ensure high standards in the project findings, include Andy Haldane, executive director of financial stability at the Bank of England, Professor Charles Goodhart from the London School of Economics and Professor Philip Bond from the University of Oxford and Bristol.