Automated Algo Trading Market

Automated Algo Trading Market Overview (2022 to 2032)

The global Automated Algo Trading Market is anticipated to grow at a stupendous CAGR of around 10.6% during the forecast period from 2022 to 2032. Growth is attributable to the rising popularity of automated algo trading among end users like personal investors and credit unions.

Report Attribute	Details
Automated Algo Trading Market Projected Growth Rate (2022 to 2032)	10.6% CAGR
Estimated Base Year Value (2021)	USD 13,260.4 Million
Expected Market Value (2022)	USD 14,520.1 Million
Expected Market Value (2032)	USD 39,715.3 Million

The penetration of modern technologies is rapidly changing the way of traditional investment models or trading methods by automating all trading related processes. Latest trading platforms like automated algo trading have reduced the transitional costs and human errors, and significantly made the whole trading process cheaper and less cumbersome.

Automated algo trading uses a computer program that follows a defined set of instructions to place a trade (buying or selling of an asset). The defined set of instructions are based on quantity, price, timing or any other mathematical model. It initiates profit opportunities at great frequency and speed, by programming the computers to follow a specific set of calculations, guidelines, and instructions.

Rapid shift towards automated algo trading for taking the decisions at a very fast pace by reducing human errors is emerging as a key factor accelerating the growth of automated algo trading market.

Automated algo trading makes trading more systematic by eliminating human trader’s emotional impact on it. These platforms execute trading at the best prices and allow continuous monitoring of the trade market throughout the day and night. Adoption of automated algo trading therefore diversifies trading and allows businesses to make sure that there are no missed opportunities. In automated algo trading, the algorithms stick to an unwavering trading plan involving the trade’s price, timing, quantity and other mathematical parameters.

With growing penetration of advanced trading technologies across developed and developing economies and increasing participation of international markets, the global automated algo trading market is forecast to grow at prolific pace during the forecast period.

The liquidity in equity market due to integration of financial markets is a major factor that would drive the automated algo trading market during the forecast period.

Various end users including personal investors, credit unions, insurance firms, prime brokers, and multi-national investment banks are vigorously investing in adopting and upgrading the automated algo trading platforms. This will continue to boost market growth in the forthcoming years.

Which Factors are Spurring the Growth of Automated Algo Trading Market?

The robust expansion of automated algo trading market is attributable to the growing demand for fast, effective, and reliable order execution, favorable government regulations, reducing transactional costs, and rising demand for market surveillance.

During the last few years, demand for automated algo trading has risen at an incredible pace and the trend is likely to continue during the forecast period. It offers various advantages by executing trades at best possible prices and reducing transaction costs as well as manual errors.

Automated algo trading is being increasingly used by leading brokerage houses, personal investors, credit unions, insurance firms etc. to cut down costs associated with trading. Adoption of automated algo trading enables faster and easier execution of orders, which makes it ideal for exchanges. It is especially ideal for situations where a human trader is not able to handle enormous numbers of trading.

Similarly, rising penetration of artificial intelligence (AI) and machine learning across financial services companies and other trading businesses is expected to generate lucrative growth opportunities within the global automated algo trading market during the assessment period.

Additionally, introduction of advanced automated algo trading platforms by market players to serve various needs of end users is anticipated to further expand the size of automated algo trading market in future.

What are the Challenges Faced by the Automated Algo Trading Industry?

Despite the growing popularity of automated algo trading, there are various factors that are likely to challenge market growth during the forecast period. Some of these factors are the increase in the amount of data to be processed and certain risks such as sudden system failure, erroneous network connectivity, imperfect algorithms, and time lags in order and executions, associated with automated algo trading solutions.

Moreover, lack of availability of modern facilities and poor awareness about automated algo trading across various emerging nations is also limiting the market growth.

Will North America Retain its Dominant Position in the Global Automated Algo Trading Market?

As per FMI, North America was the largest market for automated algo trading in 2022 and is expected to retain its dominant position during the forecast period, owing to the owing to the increasing investments in trading technologies, heavy presence of leading market vendors, favorable government support, and significant penetration of automated algo trading solutions in the financial markets.

Countries like the United States are becoming the ideal destinations for automated algo trading vendors due to growing adoption of modern trading technologies and increase in the number of end users.

How Will Growth Unfold in Asia Pacific Market?

According to Future Market Insights, the Asia Pacific automated algo trading market is expected to grow at a healthy CAGR during the forecast period from 2022 to 2032, owing to the rapid economic boom in countries like China and India, growing consumer awareness about the benefits of automated algo trading, and increasing investments by public and private sectors for enhancing their trading technologies.

Market Competition

Some of the key participants present in the global automated algo trading market include Vela, AlgoTerminal LLC, AlgoTrader GmbH, Cloud9Trader, Quantopian, InfoReach, Inc., Trading Technologies International, Inc., QuantConnect, Tethys Technology, and Citadel, among others.

These leading market players are constantly introducing innovative automated algo trading solutions to help end users in smoothly running their businesses. Besides this, they have adopted growth strategies such as mergers, acquisitions, and partnerships to expand their global footprint.

Report Scope

Report Attribute	Details
Growth Rate	CAGR of 10.6% from 2022 to 2032
Base Year for Estimation	2021
Historical Data	2015 to 2020
Forecast Period	2022 to 2032
Quantitative Units	Revenue in USD Million and CAGR from 2022 to 2032
Report Coverage	Revenue Forecast, Volume Forecast, Company Ranking, Competitive Landscape, Growth Factors, Trends and Pricing Analysis
Segments Covered	Application, End User, Region
Regions Covered	North America; Latin America; Western Europe; Eastern Europe; APEJ; Japan; Middle East and Africa
Key Countries Profiled	USA, Canada, Brazil, Argentina, Germany, UK, France, Spain, Italy, Nordics, BENELUX, Australia & New Zealand, China, India, ASEAN, GCC, South Africa
Key Companies Profiled	Vela; AlgoTerminal LLC; AlgoTrader GmbH; Cloud9Trader; Quantopian; InfoReach, Inc.; Trading Technologies International, Inc.; QuantConnect; Tethys Technology; Citadel
Customization	Available Upon Request

Key Segments Profiled in the Automated Algo Trading Industry Survey

By Application:

• Trade Execution
• Stealth/Gaming
• Statistical Arbitrage
• Strategy Implementation
• Electronic Market-making
• Liquidity Detection

By End User:

• Personal Investors
• Credit Unions
• Trusts
• Pension Funds
• Insurance Firms
• Prime Brokers
• Investment Funds

By Region:

• North America
• Latin America
• Western Europe
• Eastern Europe
• APEJ
• Japan
• Middle East & Africa

Frequently Asked Questions

At what rate will the global automated algo trading market grow?

FMI projects the global automated algo trading market to expand at around 10.5% to 11.0% CAGR between 2022 and 2032.

Which is the most lucrative market for automated algo trading?

North America will continue to remain the most lucrative market for automated algo trading during the forecast period.

Which are some prominent players in automated algo trading market?

Vela, AlgoTerminal LLC, AlgoTrader GmbH, Cloud9Trader, and Quantopian, InfoReach, Inc. are some prominent market players operating in the automated algo trading market.