| July 16
What is Algo Trading?
Algorithmic trading or algo trading is an automated
computerized method of stock trading. It has been designed to help traders to
minimize their trading costs and efforts. Algo trading involves trading through
a program that uses advanced and complex mathematical formulas to make speedy
and smart transactions.
Algo trading helps you to place a purchase or sale order at
your convenience, automatically generating the timingbased upon the parameters
specified by the trader. There are no limitations related to the quality and
volume of trade.
Algo trading enables you to trade on every opportunity. You
not only avail each and every market opportunity but also benefit from risk
reduction in case of bigger portfolios. Algo trading includes automated checks,
which help you in controlling risk factors.
With an effective Order Management System (OMS) and emotion-free
trading, it increases your profitability. This is an outcome of a minimal time
lag as the quick execution of trade provides you the best price.
Though Algo trading is not extremely
popular at the moment, it is gradually gaining faith as one of the most profitable
forms of trading online among investors. Here we are listing seven major
benefits of algo trading:
1. Trade on every opportunity
2. Get the best price through quick execution
3. Increases profitability by minimizing time lag
4. Emotion-free trading for best results –
eliminates humanly limitations
5. Backtesting of strategies
6. Automated checks for risk reduction, especially
with the bigger portfolios
7. Quick and easy trading that drives the best
Since algo trading comes with so many benefits, various platforms
in the Indian finance market are supporting this form of trading. Many of these
platforms are allowing both institutional and retail investors to trade through
Algo trading or algorithmic trading.
Algo trading is the future of trading in the Indian stock
market. Have you tried it yet?
Get started now!