Introduction to Algorithmic Trading Strategies

Abstract

In the past few decades, securities trading has experienced significant changes as more and more stages within the trading process have become automated by incorporating electronic systems. This Paper gives an overview of Algorithmic Trading and its benefits in the ever-advancing technology where industries are revolutionized by the automation and optimization of tedious manual processes. The trade management industry is no exception. The paper then talks about different commonly used Algorithmic Strategies used for Trading Execution illustrated with the help of examples. There are different market situations and trader’s requirements depending on which different Algorithmic Strategies are used, and this paper will try to uncover those areas. We specifically would cover Market Order, Limit Order, Iceberg Order, Stop Order, Trailing Stop Order, Market-Not Held Order, and Momentum Strategy.