What is Algo Trading?

1. Algo trading also known as, algorithmic trading, automated trading or black-box trading is simply computer-generated programming used to carry out market orders while following the pre-defined set of rules and instructions based on stock price, timing, quantity, volume and other parameters to execute the buy or sell orders at a faster speed. What is Algo Trading? www.moneysukh.com

2. How Does Algo Trading Work? Stock market algorithms are developed by human brains using coding to instruct the computer system to make decisions and take actions accordingly. Algorithmic trading keeps human emotions out of the trade. Read More www.moneysukh.com

3. To better know how algorithmic trading works in the stock market let’s take an example. Suppose you want to set the criteria of buying the XYZ Company’s 100 shares when the price reached Rs 500 and selling shares when the price goes above Rs 550. • In another case, if you want to sell 100 shares of XYZ Company if its 20-day moving average goes below the mark of 200 or buy 100 shares of a company when its 100-day moving average moves beyond the 200-day moving average. Or you are looking to buy 100 shares of XYZ Company if it goes above Rs150 before the market closes. • While considering all such factors if want to execute this transaction manually, you have to stick on your computer screen throughout the day and track the stock price and other parameters. Algorithmic Trading Example Read More www.moneysukh.com

4. Is Algo Trading Profitable? While discussing this topic a question arises is algorithmic trading profitable? The answer is if your algorithmic strategy is effective and fully tested in the market or you are using the right strategy at the right time on the right stock you will generate profits. Though it is hard to define how much profit can be gain but comparatively you will get better returns. Read More www.moneysukh.com

5. What is Quantitative Trading? Using the stock trading algorithm software huge quantity of trades are executed during market hours to generate profits. This is also called high-frequency trading in which frequent turnover of small traders takes place and generates profits on every trade. Hence, there is no doubt if deployed precisely, Algo trading gives handsome rewards. And there are few strategies if implemented rightly, can give consistent returns with zero loss. Though the high rate of returns is not possible when volatility index (VIX) also high but it can give you assured returns with making your investment highly profitable in the long term. Read More www.moneysukh.com

6. Though, computers perform better than humans with zero errors and not become tired. But every technology-based system has drawbacks and hurdles. Similarly, algorithm trading sometimes also fails in the stock market and not gives the expected returns. • There are many reasons why Algo trading fails, like algorithm strategy is not tested properly before the implementation. Or accurate data is not used to develop the stock trading algorithm software that fails to give profits to traders, let’s find out more. • Inaccurate or Insufficient Data: While developing such AI-based models a huge amount of historical data is used to train the model through a machine learning algorithm. If data is not accurate the strategy will not work properly causing unexpected transactions or huge losses in the market. Why Algo Trading Fails? Read More www.moneysukh.com

7. Algo Trading Software Tradetron Algobulls 01 02 Moneysukh Brought to you an ALGO Trading platform. Another splendid and Unique Platform for Algo Trading. Read More Read More Quantman Fox Trader 03 04 Quantman is an online strategy testing and trading platform. The best way to capitalize on the future is to first. Read More Read More www.moneysukh.com

8. Conclusion Algorithmic trading no doubt is bringing the evolution of huge volume in the stock market. It has reduced human costs due to automated trading systems. Since the stock exchanges allowed Algo trading, most of the broking houses or institutional financial institutions are now using automated stock trading systems and generating profits for their customers. If the right AI algorithm for stock trading is used while developing Algo trading software it can give the best returns compared to a human-operated manual trading system. And if the right strategy is applied right time as per the market conditions it can give the best returns in intraday trading. The strategies changed as per the trends in the stock market or stocks. www.moneysukh.com

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