Nicholas Pratt
Nicholas Pratt

Execution Algorithms - the next stage in optimising your FX trading performance

Nicholas Pratt talks with a variety of industry players to gauge what impact algorithmic trading is having on the FX market and how the use of algorithms can optimise trading performance.

First Published: e-Forex Magazine 31 / Algorithmic FX Trading / April, 2008

Many people feel that the term ‘algorithmic trading’ is much overused in today’s FX market. Overused it may be but what exacerbates the frustration with this whole topic is that every time the algorithm term is used, there tends to be a different definition attached to it. For example, some people in the market draw a clear distinction between algorithmic trading and algorithmic execution – the former referring to the algorithms used to determine the decision to trade, whereas the latter relates purely to the execution process that takes place once the trading decision has been made. There are further distinctions to be made in the types of algorithms that are offered and used in the FX market and who is offering them. There is also a range of potential customers from hedge funds building their own proprietary trading systems, banks building their own internal proprietary trading shop and also those banks that are looking to offer advanced execution algorithms to their FX...continued

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