HFT Scan: Aavas Financiers and DCW Limited in focus of algo traders

High-frequency trading firms (HTFs) – or algo firms on steroids –use complex algorithms and powerful computers to execute trades at lightning speeds.

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High-frequency trading was seen in the Aavas Financiers, DCW Limited, and Spectrum Foods counters on April 5. All the stocks closed higher.

High-frequency trading firms (HTFs) – or algo firms on steroids –use complex algorithms and powerful computers to execute trades at lightning speeds. These firms typically try to capture the spread between the spot and futures prices, but recently they have been active in small, illiquid stocks as well.

The volumes generated by them, more often than not, attract retail investors to these stocks.

Stocks where HFTs were active on April 5:

Aavas Financiers
Active names and traded stake: Graviton Research Capital (0.57 percent)
Stock movement and volumes: Gained 10.8 percent to Rs 1598.55. Trading volumes at 7 lakh shares versus 1-month average of 9 lakh shares
Technicals: The stock is above its 50-DMA and 200-DMA
Fundamental trigger, if any: The company on April 4 announced its Q4Y24 update

DCW Limited 
Acive names and traded stake: Topgain Finance Limited (0.64 percent), Graviton Research Capital (0.75 percent), HRTI Private Limited (0.75 percent), Crony Vyapar (1.43 percent)
Stock movement and volumes: Gained 3.71 percent to Rs 58.7. Trading volumes at 42 lakh shares versus 1-month average of 43 lakh shares
Technicals: Stock is above 50-DMA and 200-DMA
Fundamental trigger, if any: No

Spectrum Foods
Active names and traded stake: Mansi Share and Stock Advisors Limited (0.1 percent)
Stock movement and volumes: Gained 5 percent to Rs 40.97. Trading volumes at 90,000 shares versus 1-week average of 1 lakh shares
Technicals: Stock is above 50-DMA and 200-DMAFundamental trigger, if any: No