Algo Trading Market to Surpass $18.8 Billion in Five Years

According to MarketsandMarkets™, the global algorithmic trading market will be valued at $11.1 billion in 2019, and is projected to grow by a compound annual growth rate (CAGR) of 11.1 percent over the next five years. The research firm expects this figure to hit $18.8 billion by 2024.

Algo trading involves the use of automated programs to follow a set of instructions to perform trades, taking into account factors such as time, price and volume. Such platforms take advantage of artificial intelligence and human intelligence in order to reduce trading costs and help money managers control their business procedures. The main benefit here is not only to maximize the profits but also to control the market risk and the transactions costs.

Among algorithmic trading market applications, the stock markets segment is expected to exhibit the highest growth rate during the forecast period, says the research paper.

The emergence of AI in the financial service sector and increasing demand for ‘fast, reliable, and effective order Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term’ are the major factors aiding in the growth of the global Algo Trading Algo Trading Algo trading sometimes referred to as algo, may be defined as computerized trading that employs proprietary algorithms or pre-programmed commands that are tailored to take into consideration variables like price, volume, and timing. First introduced in American financial markets in the 1970s, algo-trading is generally utilized in trading scenarios such as arbitrage, trend trading strategies, and order execution while approximately 60% of all trades were executed by computers in 2010. Today, algo Algo trading sometimes referred to as algo, may be defined as computerized trading that employs proprietary algorithms or pre-programmed commands that are tailored to take into consideration variables like price, volume, and timing. First introduced in American financial markets in the 1970s, algo-trading is generally utilized in trading scenarios such as arbitrage, trend trading strategies, and order execution while approximately 60% of all trades were executed by computers in 2010. Today, algo Read this Term market. The list of factors fueling the market growth also includes “reducing transaction costs, growing government regulations, and rising demand for market surveillance.”

North America’s dominance to continue

The report further illustrates that the North America market, which accounted for the largest share in 2018, is expected to retain its dominance during the forecasted period (2019-2024). This is due to strong technological advancements and considerable application of algorithm trading in various applications such as banks and financial institutions across the region.

The Asia Pacific is also expected to offer growth opportunities for market players thanks to the rising adoption of algorithmic trading solutions among investment banks, pension funds, and hedge funds.

The latest report on 'Algorithmic Trading Market by Trading Type' covers FX, stocks, ETFs, bonds, cryptocurrencies, and other asset classes. It provides analysis of the industry size, revenue forecast and regional spectrum of this business.