In terms of load on the stock exchange algorithmic trading infrastructure systems using the principle of the market to work with requests.
Algorithmic trading or algorithmic trading (English. Algorithmic trading) - a formalized process of trading transactions in the financial markets for a given algorithm using specialized computer systems (trading robots).
Algorithmic trading is widely used as institutional investors, for the effective execution of large applications, and private traders and hedge funds for speculative profit. In 2009, the share of high-frequency algorithmic trading accounted for about 73% of the total volume of trading in shares in the United States [1]. On MICEX in 2010, the proportion of systems in high turnover in the stock market was about 11-13%, and the number of applications 45%. According to RTS, in 2010 the share of trading robots in circulation on RTS FORTS futures market accounted for approximately 50%, and their share in the total number of applications at certain times reached 90% [2].
Algorithmic and high-frequency trading have been the subject of numerous proceedings initiated by American regulators SEC (US Securities and Exchange Commission) and CFTC (Commodity Futures Trading Commission), in connection with charges of their involvement in the events of May 6, 2010, when the major stock indexes have experienced the largest in the United States Throughout its history intraday drop [3] [4] [5]. FFMS of Russia also attended to the problems of the growing influence of algorithmic trading, but the professional market participants argue that the phenomena which had led to the fall of US stocks in the Russian market are absent in principle, due to a more efficient way of its development. Liquidity of financial instruments is usually estimated by the volume and number of transactions (trading volume), the value of the spread between the best prices of supply and demand (the highest prices of applications for purchase and minimum prices sell orders), and the total volume of orders near the lowest rate of supply and demand (and prices amount of current applications can be seen in the glass of the terminal). The greater the volume and number of transactions for the instrument, the greater its trading liquidity, in turn, the smaller the difference between the best prices of supply and demand and the greater the volume of orders near these prices, the more instant liquidity.
There are two basic principles of putting applications:
quotation - the nomination applications for the purpose of the transaction at a lower price than the current best bid or asking price. market - the nomination applications for the purpose of instant transaction at current prices, demand or supply. Application of the Algo trading platform to the quoted form instant liquidity of the market, allowing other bidders at any time to buy or sell a certain amount of the asset.
Application of the principle of form at the market trading liquidity of the market, allowing other bidders to buy or sell a specific amount of the asset at the desired price.
Algorithmic trading systems using quotation principle, are among the main suppliers of instant liquidity, and using the market principle, one of the main suppliers of trading liquidity. A large number of algorithmic systems simultaneously use both of these principles.
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About system trading
The main purpose of speculative strategies is to earn income in the short term due to fluctuations in market prices of financial instruments.
Binary option
Binary option (digital option, the option of "all or nothing" option or fixed return) - an option that, depending on the implementation of the agreed conditions at the agreed time or provides a fixed amount of income
Trading binary!
Making a profit, which is known before the purchase of the option. This condition occurs in the case of successful prediction of the direction of price movement.
