*1 Based on examination conducted by Toshiba Corporation
*2 According to [Shleifer A., and R. W. Vishny, 1997, The Limits of Arbitrage, The Journal of Finance, March 1997, Vol. 52, No. 1, pp.35-55], market efficiency is achieved by arbitrage*5 whose effect is to bring prices to fundamental values.
*3 An index that indicates the level of ease for investors to trading stocks in the market. Market with high liquidity is where you can execute large-lot trading at any time without significantly impacting the market price.
*4 This refers to high speed trading defined in Article 2 Paragraph 41 of the Financial Instruments and Exchange Act of Japan. According to [1st Market Working Group by the Financial System Council of Japan, Secretariat Briefing Materials, May 2016], the ratio of the number of orders from the co-location area to all transactions on the Tokyo Stock Exchange was over 70% as of January 2016, and it is said that most of them are orders from HFT. According to [Malceniece L., K. Malcenieks, and T. J. Putnins, 2019, High frequency trading and comovement in financial markets, Journal of Financial Economics, Vol. 134, pp.381-399.], while estimates of scale of HFT activity vary depending on the market and how broadly HFT is defined, there is no doubt HFT accounts for a large share of trading volume in most developed markets.
*5 Brogaard J., H. Terrence, and R. Ryan, 2014, High-Frequency Trading and Price Discovery, The Review of Financial Studies, August 2014, Vol. 27, No. 8 (August 2014), pp.2267-2306.
*6 Arbitrage is defined by [Sharp W., and G. Alexander, 1990, Investments, 4th edition] as 'the simultaneous purchase and sale of the same, or essentially similar, security in two different markets for advantageously different prices'.
*7 In this article, 'wide-area search' mean finding the best one from all candidates. Specifically, the term is referring to find the best investment opportunity by solving mathematically defined combinatorial optimization problems.
*8 Toshiba Press Release 1: https://www.global.toshiba/ww/technology/corporate/rdc/rd/topics/19/1904-01.html; H. Goto et al., Science Advances 5, eaav2372 (2019). https://advances.sciencemag.org/content/5/4/eaav2372
Toshiba Press Release 2: https://www.global.toshiba/ww/technology/corporate/rdc/rd/topics/21/2102-01.html; H. Goto et al., Science Advances 7, eabe7953 (2021). https://advances.sciencemag.org/content/7/6/eabe7953
Toshiba Press Release 3: https://www.global.toshiba/ww/technology/corporate/rdc/rd/topics/21/2103-01.html; K. Tatsumura et al., Nature Electronics 4, 208-217 (2021). https://doi.org/10.1038/s41928-021-00546-4
*9 Toshiba Press Release: https://www.global.toshiba/ww/technology/corporate/rdc/rd/topics/19/1910-02.html; K. Tatsumura et al., IEEE Int'l Symp. on Circuits and Systems (ISCAS), 1-5 (2020). https://doi.org/10.1109/ISCAS45731.2020.9181114
*10 As a high-speed trading operator as defined in Article 2 Paragraph 42 of the Financial Instruments and Exchange Act of Japan.