Algorithmic trading

Algorithmic trading, also known as algo trading, is a trading method that uses computer programs to execute trades at a speed and frequency that is impossible for humans. Here are some key points to better understand this concept:

Operating Principle

• Algorithms: These are sets of programmed rules and instructions that define when and how to buy or sell financial assets.

• Automation: Trades are made automatically based on predefined parameters, such as price, volume or timing.

Benefits

• Speed and Accuracy: Algorithms can process thousands of transactions in a fraction of a second, minimizing human errors and delays.

• Data Analysis: Algorithms can analyze vast amounts of market data and react instantly to changes.

• Cost Reduction: Automation reduces labor costs and allows complex strategies to be executed without continuous human intervention.