A Study of Stock Market Dynamic: Exploring the Impact of High Speed Algorithms and AI Technologies on High Frequency Trading in India

As With a specific focus on the role of High-Frequency Trading (HFT) driven by high-speed algorithms and Artificial Intelligence (AI), this study delves into the developing landscape of India's stock market. HFT is gaining significant momentum by leveraging advanced algorithms to execute trades in microseconds, as global financial markets embrace automation. In the Indian stock market, this rapid shift towards high-frequency trading is reshaping the stock market dynamics, impacting liquidity, market efficiency, and volatility. This paper aims to explore how AI-powered algorithms influence the market trading strategies, allowing for faster decision-making and more accurate execution of trades. This study will focus on analysing the positive and negative impact of high-speed algorithms on Indian stock market. It will also evaluate their impact upon liquidity, price discovery, and overall market behaviour. This research paper on how to enhance oversight while fostering a healthy, competitive trading environment. It also seeks to provide insights into the balance between innovation and regulation. Ultimately, by highlighting both the opportunities and risks associated with these cutting-edge technologies, the findings of this paper will contribute to our deeper understanding of how AI and algorithmic trading are transforming the landscape of Indian stock market. This knowledge would be very essential for the market participants, regulators, and policymakers who are aiming to navigate the future of finance in India.