Algorithmic Trading the New Platform Tool for Trading Companies

Ever since India was allowed to use advanced technology in equity markets, algo trading companies in India have been on the rise. This means traders need to be aware of the trading platforms available to deal with the significant number of exchanges being traded. Here’s what you need to know about how and why algorithmic trading is so popular especially for equity market in India.

Strategies in Algorithmic Trading

When the algorithmic trading strategy is based on a particular trend, which determines the predictions and moves you make, it is known as momentum based strategy. Strategies that depend on corporate events are known as statistical arbitrage like acquisitions or mergers. These strategies influence investments and are widely used by proprietary traders. Sometimes trading opportunities arise because of a price misquote. Although these opportunities arise suddenly and last for very short durations, algorithmic trading companies in India can pick these up instantly. Market making is another key strategy that involves liquefying securities that are not often traded at the stock exchange in order to make a profit. To build fool proof systems or to update your algorithmic strategy, it is essential for proprietary traders to learn programming.               

Platforms in Algorithmic Trading

Omnesys is a leading platform, capable of performing many strategies. Its versatile nature allows brokers to trade in equities, currency and commodities. A customized version called Omnesys Nest Gate can be used in real time to assist with cautious decision making. Presto ATS is a popular algorithmic trading platform used in India in all asset classes. Odin includes features like order management system, API integration and risk management. Only recently Odin has been made more aggressive by integrating it with new segments like MCX-SX equity and UCX. A global leader in execution of trading systems for foreign exchange and fixed income securities is Flextrade. For those traders interested in the forex market predictions, the Ninja Trader is a flexible platform. Algonomic platform creates multiple strategies, reduces transactional costs and aims on optimizing profits. Another customizable and popular platform that requires a subscription is Tradestation.

Importance of algorithmic trading

Algorithmic trading helps turn the notch up on trade execution efficiency and also add liquidity to the market. It enhances investment and trading strategies that involve arbitrage and market making. Algorithms are able to trade under precise conditions in timing, price and volume. Commonly used by large trading investors, algorithm trading strategies get the best price on a stock with increasing the purchasing price. Ever since algo trade was introduced into the Indian market there has been a steady rise in large domestic and foreign investors. Algo trading companies in India also allow for manual intervention which suits the client’s preference. Through API, investors can select their strategy, set the program according to their requirements and execute it as a broker. High frequency trading is most often backed by algos.

Algo trading strategies can be deemed successful depending on the speed of execution and the distance bandwidth connections take to travel. So, there you have it - Algorithmic trading companies in India don’t just pave the way for effective investment strategies but also work in tandem with the client to achieve a resounding profit.

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Created on Aug 31st 2018 01:45. Viewed 661 times.

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