Algorithmic Trading Market to Surpass US$ 21,685.5 Million by 2026 - Coherent Market Insights

Published On : Feb 02, 2019

The global algorithmic trading market was valued at US$ 9,297.2 million in 2017, and is projected to reach US$ 21,685.5 million by 2026, exhibiting a CAGR of 10.1% over the forecast period, according to Global Algorithmic Trading Market Report, by Component (Software and Services), by Deployment Model (On-premise, Cloud,  Hybrid), by Application (Equities, Forex, Commodities, Funds, Others), and by Region (North America, Europe, Asia Pacific, Latin America, Middle East, and Africa), published by Coherent Market Insights.

Algorithmic trading, or algo trading, is useful for computer programs and software to execute trade based on pre-defined criteria and without any human intervention. In algorithmic trading, mathematical models are used to analyze every quote and trade in the stock market, turn the information into intelligent trading decisions, and identify liquidity opportunities. It is a computer directed trading, which cuts down transaction costs and allows investment managers to take control of their own trading processes. The major factor driving adoption of algo trading is rising number of financial organizations opting for automation of trading processes. Also, companies in emerging economies such as India, South Korea, and others that are expanding their presence in international markets with diverse portfolio, are leading to high demand for algo trading process. In addition to this, increasing adoption of cloud-based solutions and services has further boosted growth of the algorithmic trading market.   

To know the latest trends and insights prevalent in this market, click the link below:

https://www.coherentmarketinsights.com/market-insight/algorithmic-trading-market-2476

Key Trends and Analysis of the Global Algorithmic Trading Market:

  • Among applications, commodity trading segment is expected to exhibit the highest growth rate during the forecast period. Trading firms mostly use algorithmic trading as it eliminate human errors. Algorithmic trading is used across various markets in finance industry such as forex, stock markets, commodities, bonds and cryptocurrency. Commodity trading market is one of the dominating markets in algorithmic trading. For instance, according to paper published by Commodity Futures Trading Commission (CFTC), agency of the US government, in US trading market, the level of automation and the speed of trading continues to increase. This increase has been more prevalent for asset classes or contract groups where automation penetration had been low, relative to the rest of the market. For instance, according to CFTC (The U.S. Commodity Futures Trading Commission), on the basis of trading activity from November 1, 2014 to October 31, 2016, trading in energy-related contracts in the prior period (before 2014) was around 47% automated. In the more recent period, this has risen to around 57%; agricultural commodities have risen a similar amount from 38 to 48%. Other groups of products, such foreign exchange and stock index futures, appear to have hit a rough automation equilibrium prior to the most recent period, and so experienced less incremental change (FX (foreign exchange), as one case, increased from 80 to 83%).

Key Takeaways of the Market:

  • According to Coherent Market Insights’ analysis, Europe is the second largest region in the global algorithmic trading market and is expected to witness high growth over the forecast period. This is attributed to increasing adoption of cloud-based solutions, services, and cloud computing in the region. According to Coherent Market Insights, in March 2017, overall cloud adoption rate had reached a record high of 88% in the UK, an increase of 5% from 2016.
  • Some of the major players operating in the algorithmic trading market include AlgoTrader GmbH, Trading Technologies International, Inc., Tethys Technology, Inc., Tower Research Capital LLC, Lime Brokerage LLC, InfoReach, Inc., FlexTrade Systems, Inc., Hudson River Trading LLC, Citadel LLC, and Virtu Financial

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Coherent Market Insights is a prominent market research and consulting firm offering action-ready syndicated research reports, custom market analysis, consulting services, and competitive analysis through various recommendations related to emerging market trends, technologies, and potential absolute dollar opportunity.

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