If you don’t know, algorithmic trading is the use of special apps for trading orders. Actually, with the algorithm apps, complex calculations involving price, quantity and timing of the order is carried out. And the great thing about these programs is that they work automatically, and you don’t have to operate them manually. Let’s know more about this system.
The logic
The apps involved in this trading system work both on short-term and long-term basis. They allow you to make profit in 24 hours as well. What logical system works behind them? Actually, the function of the programs is to detect price differences and then help you earn profit from the price differences. The decisions of a human are influenced by emotions, but the same can’t be said about computer programs.
High Frequency Trading
Basically, HFT refers to the trading system where the focus is on the execution speed. An HFT system is so powerful that it can process and execute an order in a jiffy, usually in a fraction of a second. That’s the reason these systems can be seen in a number of institutions.
The purpose of the system is to benefit from the price differences and earn a lot of profit. The orders should be executed quickly with high volume. This is to help the system make a fast liquidation of the trade. Typically, all of the trades are closed within a few minutes or hours.
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