Why Institutions Use
In the early 2000s, algo trading consisted of just roughly 15% of market volume in the U.S. stock market. However, algo trading is now used in most large institutional firms and 80% of the daily moves in U.S. stocks are machine-led. Machines are causing sharp drops and rallies based on immediate data releases. Long-term investors may stand a better chance as algos are focused more on extreme short term (microseconds or minutes).
The World Is Changing,
So Are Traders
Discover the current adoption of Algorithmic trading
and the next generation of machine learning
Increased Electronic Trading
Increased Algorithmic Trading
Increased Voice Trading
Expected No Changes
18% of respondents reported that their execution style will continue to change going forward, and 100% of these respondents reported a predicted increase in electronic trading.
When Asked About Artificial Intelligence And Machine Learning, Traders Agreed That They:
Deep Data Analytics
Optimize Trade Execution
Hone Trading Decisions
When asked “What percentage of your FX trading/will be done via algorithmic order?”, traders predict that an additional 15% of their FX trading will be done via FX algos over the next two years. This ongoing increase is reflected in our own client FX volumes which are up 46% YoY*.
*Total J.P Morgan Client Algo Volume traded Jan – Dec 2019 vs. Jan – Dec 2020