High-speed traders holding investors hostage: Pro

Algorithms deciding fate of stocks: Pro
Algorithms deciding fate of stocks: Pro

Volatility has been the name of the game lately, and small-cap stock picker Craig Hodges told CNBC on Monday that high-speed computer trading is to blame.

Stocks opened strongly higher on Monday with the Dow Jones industrial average up triple digits early in the session on robust merger activity, and despite new U.S. sanctions against wealthy Russians as a deterrent to Moscow further meddling in Ukraine.

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"I guess the algorithms out there are deciding on a daily basis which way the market is going to go and we're kind of hostage to that on a short-term basis," the co-portfolio manager of the Hodges Fund and Hodges Small Cap Fund said in a "Squawk Box" interview.

Read MoreNYSE floor trader blasts high-frequency trading

Stocks finished lower last week with a sharp decline on Friday.

High-frequency trading's role has been debated fiercely in recent weeks, after comments by Michael Lewis about the stock market being "rigged" in his new book "Flash Boys."

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The other side of that argument says that high-speed trading creates liquidity in the market and creates fairer pricing for investors, even if the computers can execute the trades ahead of individuals.

—By CNBC's Matthew J. Belvedere.

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