Algorithmic trading enables the use of various indicators and the execution of orders that are impossible for a human to perform. Additionally, traders have more possibilities to trade when analysis and execution are faster. The algorithms are properly verified, which increases the accuracy of Algo trading.
Different kinds of Algorithmic Trading Solutions exist. Each algorithm is designed to accomplish a particular objective.
Some of the most common algorithmic trading strategies include the following:
Trend-following approach
Mean-reverting or mean-reversion strategy Robotic trading
Arbitrage technique (e.g., butterfly spread)
momentum letter Robotic trading
A computer follows preprogrammed instructions to buy, sell, or keep assets. There are several data streams used.
Algorithmic trading includes Market Making, Statistical Arbitrage, and HFT.