Algorithmic Trading

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Algorithmic trading is financial trading that is executed by software as opposed to humans. This software will follow a pre-programmed strategy. Trading algorithms have superior speed and computational power compared to humans.

Algorithmic trading is employed for many reasons. Computers are able to perform complex computations very quickly, making these algorithms great for situations that require extreme speed, such as arbitrage opportunities. Trading algorithms can also be used for very straightforward strategies to save a human the time and effort of doing it manually.