Algorithmic Trading Market expands as financial institutions leverage AI for automated trading strategies.

AUSTIN, TEXAS, UNITED STATES, June 12, 2024 /EINPresswire.com/ -- Market Scope and Overview

The Algorithmic Trading Market was valued at USD 20.66 Billion in 2023, with a predicted CAGR of 22.3% to reach USD 103.44 Billion by 2031 as per the SNS Insider report. Algorithmic trading is taking the financial world by storm, fueled by a confluence of factors. Governments are enacting policies that encourage its use, while investors seek faster, more reliable trade execution. Algorithmic tools also aid market regulators in monitoring activity and preventing manipulation. For large institutions, these algorithms translate to significant cost savings during high-volume trades. The industry is further boosted by advancements in Artificial Intelligence and specialized financial algorithms, creating exciting new possibilities.

Finally, raising cloud-based solutions makes algorithmic trading more accessible as well as cost effective. This algorithmic surge is part of a broader technological revolution that's transforming how we do business. Trading systems are becoming increasingly sophisticated, offering traders more automation and flexibility. This trend began with the introduction of super-fast matching engines in modern exchanges, removing human limitations from the equation. Algorithmic trading allows markets to operate at lightning speed, necessitating electronic surveillance to ensure fair play for all participants.

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Key Players:

The major players in market are 63 moons technologies limited, Tata Consultancy Services Limited, Algo Trader, Symphony, Argo Software Engineering, Refinitiv, InfoReach, Inc., Kuberre Systems, Inc., MetaQuotes Ltd., VIRTU Finance Inc and others.

Segment Analysis

Cloud computing is revolutionizing algorithmic trading. Traditionally, traders needed expensive on-site IT infrastructure to process trades and test new strategies. Cloud technology offers a more efficient and affordable solution. Cloud-based algorithmic trading platforms allow traders to automate processes, store and maintain data easily, and leverage remote servers for faster trade execution. This minimizes costs associated with physical IT infrastructure.

The benefits of cloud-based trading go beyond just cost savings. Traders can deploy their algorithms in the cloud for tasks like back-testing strategies, analyzing data streams, and running simulations – all while executing live trades. The "pay-as-you-go" model of cloud services also allows traders to experiment with new technologies and solutions without hefty upfront investments. This agility is a major advantage in a constantly evolving market. With more and more stock trades being automated, the shift towards cloud-based algorithmic trading is a clear trend that's transforming the financial services industry.

Market Segmentation and Sub-Segmentation Included Are:

By Solution:

➤ Platforms
➤ Software Tools

By Service:

➤ Professional Services
➤ Managed Services

By Deployment:

➤ Cloud
➤ On-premise

By Trading Types:

➤ Foreign Exchange (FOREX)
➤ Stock Markets
➤ Exchange-Traded Fund (ETF)
➤ Bonds
➤ Cryptocurrencies
➤ Others

By Type of Traders:

➤ Institutional Investors
➤ Long-term Traders
➤ Short-term Traders
➤ Retail Investors

Increasing Strategic Partnerships are Boosting the Market Growth

The algorithmic trading market is highly competitive, with numerous companies competing for market share. Major players such as Thomson Reuters, Jump Trading, and Virtu Financial are constantly seeking ways to stay ahead of the competition. One common strategy employed by these companies is to form partnerships or acquire other businesses, allowing them to broaden their product range and appeal to a wider customer base. Through ongoing innovation and service enhancement, these companies are ensuring that algorithmic trading remains a pivotal force in the financial industry.

Recent Developments Showcase Alliances & Product Pipeline Extension

In June 2023, Virtu Financial launched Alert+ which gives POSIT Alert by automated routing by Virtu's Covert execution algorithm by seeking non-displayed liquidity..

In October 2022, Multi Commodity Exchange of India Limited partnered with 63 Moons Technologies for software technology services for three months to ensure uninterrupted trading experience.

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North America Dominated the Market in 2023 Driven by the Hefty Investment in R&D

The algorithmic trading market is booming, with North America expected to be the frontrunner. This dominance stems from a perfect storm of factors. Firstly, the region is heavily invested in developing cutting-edge trading technologies like blockchain, which can significantly enhance algorithmic trading capabilities. Secondly, North America boasts a well-established presence of algorithmic trading firms, providing a strong foundation for market growth. Finally, supportive government policies actively encourage international trade, further fueling the algorithmic trading market.

However, this rapid growth isn't without concerns. The prevalence of high-frequency algorithmic trading strategies raises potential risks to market stability. To address this, regulatory bodies like the SEC and FINRA are stepping in, implementing safeguards to ensure fair practices and manage risk within the market.

On the user side, algorithmic trading's appeal to institutional investors is undeniable. Asset management firms, hedge funds, and pension funds are increasingly adopting these strategies to streamline trading processes, optimize execution, and effectively manage risk. This widespread adoption is further fueled by the availability of sophisticated trading platforms and vast troves of market data readily accessible in North America. Overall, the algorithmic trading market in North America is experiencing a surge, driven by a confluence of technological advancements, government support, and its growing adoption by institutional investors.

Key Takeaways

➤ The platforms segment accounted for a major global revenue share in 2023 as it provides a huge collection of free futures and combines data & is an efficient platform to back-test and study trading strategies.

➤ The professional services segment is leading the market owing to the rising deployment of professional services among end-users to monitor the proper functioning of trading solutions in the process.

Table of Contents- Major Key Points

1. Introduction

2. Research Methodology

3. Market Dynamics
3.1. Drivers
3.2. Restraints
3.3. Opportunities
3.4. Challenges

4. Impact Analysis
4.1. Impact of Ukraine- Russia war
4.2. Impact of Ongoing Recession on Major Economies

5. Value Chain Analysis

6. Porter’s 5 Forces Model

7. PEST Analysis

8. Algorithmic Trading Market Segmentation, by Solution
8.1. Platforms
8.2. Software Tools

9. Algorithmic Trading Market Segmentation, by Service
9.1. Professional Services
9.2. Managed Services

10. Algorithmic Trading Market Segmentation, by Deployment
10.1. Cloud
10.2. On-premise

11. Algorithmic Trading Market Segmentation, by Trading Types
11.1. Foreign Exchange (FOREX)
11.2. Stock Markets
11.3. Bonds
11.4. Exchange-Traded Fund (ETF)
11.5. Cryptocurrencies
11.6. Others

12. Algorithmic Trading Market Segmentation, by Type of Traders
12.1. Institutional Investors
12.2. Long-term Traders
12.3. Short-term Traders
12.4. Retail Investors

13. Regional Analysis
13.1. Introduction
13.2. North America
13.3. Europe
13.4. Asia-Pacific
13.5. The Middle East & Africa
13.6. Latin America

14. Company Profile

15. Competitive Landscape
15.1. Competitive Benchmarking
15.2. Market Share Analysis
15.3. Recent Developments

16. USE Cases and Best Practices

17. Conclusion

About Us

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