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Algorithmic Trading Market - Size, Share, Outlook, and Opportunity Analysis, 2018 – 2026

Author: Sumit Patil
by Sumit Patil
Posted: May 11, 2019

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Algorithmic trading, also termed as algo trading, is a method that uses computer programs and software to execute various trades with minimal human intervention. It has gained significant traction in the financial industry as it allows investment managers to be in full control of their trading process with reduced transactional costs.

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High frequency trading (HFT), which involves selling and buying of shares (mostly in thousands) in seconds, is one of the most popular method in algo trading. The computer-programmed trading follows a defined set of rules for trading. The technology incorporates human as well as artificial intelligence, which enables higher accuracy and reliability among users.

Market Dynamics

Rising number of financial organizations and investors opting for automation of trading processes is one of the major factor driving scale adoption of algo trading in the market. For instance, in April 2018, SEBI announced plans for new norms that will make algorithmic trading more accessible for investors. According to Coherent Market Insights, in year 2018, in India, algorithmic trading gained popularity among institutional investors for investment banks, hedge funds, and accounts for 35-40% of the turnover on the exchange. Moreover, emerging economies such as India, South Korea, and others, who have expanded its reach on international platforms with diverse distribution and portfolio has increased demand for algo trading process.

Growing demand for AI-based services in financial sector drives growth of the algorithmic trading market. In algorithmic trading, AI helps to adopt market conditions, learn from experiences, and accordingly make trade decisions. Trading houses such as Blackrock, Renaissance Technologies, Two Sigma, and others, are using AI for selecting stocks. According to Coherent Market Insights, in 2018, about 37% of the financial institutions in India invested in artificial intelligence-focused technologies and around 68 % plan to adopt it in the near future. Therefore, increasing adoption of AI in financial sector is expected to drive growth of the algorithmic trading market over the forecast period.

Key Players in the Global Algorithmic Trading Market:

Some of the key players operating in the market include AlgoTrader GmbH, Trading Technologies International, Inc., Tethys Technology, Inc., Tower Research Capital LLC, Lime Brokerage LLC, InfoReach, Inc., FlexTrade Systems, Inc., Hudson River Trading LLC, Citadel LLC, and Virtu Financial.

Detailed Segmentation:

  • Global Algorithmic Trading Market, By Component:

    • Software

    • Services

  • Managed Services

  • Professional Services (Maintenance, Integration, Consulting)

  • Global Algorithmic Trading Market, By Deployment Model:

    • On-Premise

    • Cloud

  • Private Cloud

  • Public Cloud

    • Hybrid

  • Global Algorithmic Trading Market, By Application:

    • Equities

    • Forex

    • Commodities

    • Funds

  • Mutual

  • Hedge

  • Pension

  • Others (Insurance, Bonds, Virtual Currency, etc.)

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About Coherent Market Insights:

Coherent Market Insights is a prominent market research and consulting firm offering action-ready syndicated research reports, custom market analysis, consulting services, and competitive analysis through various recommendations related to emerging market trends, technologies, and potential absolute dollar opportunity.

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Tel: +1-206-701-6702

Email: sales@coherentmarketinsights.com

About the Author

About Coherent Market Insights: Coherent Market Insights is a prominent market research and consulting firm offering action-ready syndicated research reports, custom market analysis, consulting services, and competitive analysis through various reco

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  • digitalkora  -  5 years ago

    Hii, Thanks for sharing useful information regarding Marketing trade. I'll regularly follow this site for daily blog.Thank you for updates. Myself sam recently completed my training in Digital Marketing Courses in malleshwaram from Digitalkora

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Author: Sumit Patil

Sumit Patil

Member since: Feb 26, 2019
Published articles: 193

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