Chapter 1

Algorithmic Trading

This chapter introduces readers to algorithmic trading. We provide a description of the electronic trading environment and discuss issues required to make proper algorithmic trading decisions. We present and critique the major theories of algorithmic trading, and provide further insight into where change may continue to expand. We describe the current state of trading algorithms (both single stock and portfolio algorithms) and provide a classification system to assist investors and buy-side traders navigate the ever-changing algorithmic landscape. The chapter ends with a discussion of the recent market changes that have been accompanied with algorithmic trading.


algorithms; High Frequency Trading (HFT); Volume ...

Get The Science of Algorithmic Trading and Portfolio Management now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.