Financial Terms Dictionary: ELI5 Version - Algorithmic Trading

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Algorithmic Trading:

Algorithmic trading, also known as algo-trading or automated trading, is a sophisticated and technologically-driven strategy in the realm of financial markets, wherein computer algorithms execute pre-defined sets of instructions to facilitate the rapid and efficient execution of trades. This cutting-edge approach leverages quantitative models, statistical analysis, and computational power to process vast quantities of market data, enabling the seamless implementation of intricate trading strategies with minimal human intervention.