High-frequency trading increases stock market volatility.

Is it true that high-frequency trading increases stock market volatility?

Partly. Evidence is mixed and partial: one US study finds HFT positively correlated with stock price volatility, while Swedish and ETF-crisis studies find HFT associated with lower volatility, and a forum answer calls the theoretical effect ambiguous. No item settles the general claim across markets.

Verdict: CONTESTED PARTIAL · 3 sources for, 3 against · Last checked 18 Oct 2026

The private library was unavailable for some searches in this check. Missing library results are not evidence against the claim.

High-frequency trading. (n.d.). en.wikipedia.org. https://en.wikipedia.org/wiki/High-frequency_trading

Effects of High Frequency Trading on the Malaysian Stock Market. (2019). doi.org. https://doi.org/10.1145/3343485.3343498

Zhang, F. (2010). High-Frequency Trading, Stock Volatility, and Price Discovery. doi.org. https://doi.org/10.2139/ssrn.1691679

Zhao, Y. & Yang, L. (2026). Market Liquidity, High-Frequency Trading, and Corporate Bond Pricing: Evidence from U.S. Mutual Fund Flows and Volatility Dynamics. doi.org. https://doi.org/10.2139/ssrn.7412644

The impact of high-frequency trading on the Swedish stock market – based on liquidity and volatility. (2018). urn.kb.se. http://urn.kb.se/resolve?urn=urn:nbn:se:liu:diva-148882

Withdrawal of High-Frequency Traders and Intraday ETF Volatility during the COVID-19 Crisis. (2022). ssrn.com. https://doi.org/10.2139/ssrn.3992113