Advances in Consumer Research
Issue 1 : 1337-1345
Original Article
Quantum Computing Applications in Financial Risk Modelling and High Frequency Trading
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1
Hod., Department of Computer Applications, Sindhi College, Chennai
2
Principal, Pattammal Alagesan College, Athur, Chengalpattu
3
Associate Professor, The Oxford College of Science, Arts, Commerce and Management, Bangaluru
4
Associate Professor, NSB Academy, Banguluru
5
Assistant Professor, Teerthanker Mahaveer College of Pharmacy, Teerthanker Mahaveer University, Moradabad, Uttar Pradesh
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Associate Professor, Department of NSHM Business School, NSHM Knowledge Campus - Kolkata Group of Institutions, 60 B L Saha Road, Kolkata 700053, West Bengal, India
Abstract

Quantum computing promises new computational paradigms that may materially alter approaches to financial risk modelling and high-frequency trading (HFT). This paper examines the theoretical foundations and near-term prospects for quantum algorithms applied to core financial tasks: Monte Carlo-based derivative pricing and risk estimation, combinatorial and convex optimization for portfolio allocation, and latency-sensitive decision processes characteristic of HFT. We synthesize recent developments in quantum Monte Carlo methods, quantum-accelerated optimization (including quantum annealing and variational hybrid algorithms), and quantum-enhanced machine learning, assessing their algorithmic complexity, noise sensitivity, and integration pathways with classical infrastructure. Emphasis is placed on practical performance metrics—error bounds, time-to-solution under realistic device noise, and communication/latency constraints relevant to trading venues—and on regulatory, cryptographic, and operational risks introduced by quantum-capable systems. Case studies illustrate how hybrid quantum-classical workflows could improve risk estimation accuracy and portfolio rebalancing decisions, while identifying the principal bottlenecks that prevent immediate adoption in latency-constrained HFT environments. We conclude with a roadmap for translational research that prioritizes benchmarking, robustness to adversarial market behavior, and the development of quantum-resilient cryptographic practices for financial institutions

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