In today's highly competitive and cost-conscious trading environment, algorithms have become a must-have for fund-managers and traders. Algorithmic trading refers to the use of algorithms for placing a trades in order to generate profits at a speed and frequency that is not possible for a human trader. The rules built into the model attempt to determine the optimal time for placing an order based on the goals specified by the parameters of the model. The main benefits of algorithmic trading are : Algo-trading makes markets more liquid and makes trading more systematic by ruling out emotional human impacts on trading activities.The most significant advantage of algorithmic trading is that it eliminates emotional bias from the process of trading as all trades are executed automatically when the trade rules are met. Most traders and investors lose money due to greed and fear. Algorithmic trading rules out the chances of human emotions induced mistakes as traders will not be able to hesitate or question the trade. The trading opportunity is automatically identified and hence the trades are executed at the best possible prices.Algorithmic trading helps in constantly examining the changing market conditions and generating orders as soon as the trading criteria [...]The post Algorithmic Trading appeared first on NeuralTechSoft.
