Lower transactional expenses. automated tests are running simultaneously in various market situations. less possibility of human error when placing trades. To determine whether algorithmic trading is a feasible trading method, available historical and real-time data can be used for backtesting.
Algorithmic trading, also known as automated trading, black-box trading, or algo-trading, involves placing a trade using a computer program that adheres to a predetermined set of guidelines (an algorithm). Theoretically, the deal can produce profits at a pace and frequency that are beyond the capabilities of a human trader.
According to Best Algorithmic Trading Experts, high-frequency trading (HFT), which aims to profit from placing numerous orders quickly across numerous markets and various decision parameters based on preprogrammed instructions, makes up the majority of today's algorithmic trading.