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A more optimistic outlook for the algorithmic trading landscape
In a record year for respondents in The TRADE ’ s Algorithmic Trading Survey , the landscape has proven to be more promising , with respondents highlighting ease of use and customer support as a top priority , and only a handful of categories continuing their downward trend this year .
With an increasingly complex and interconnected market , the need for speed , precision and automation has become of vital importance . From the initial days when algorithms were simple rulebased systems , executing predefined strategies , to the current landscape where machine learning and artificial intelligence-driven models exist , advancements in algorithmic trading have become essential to the adaptability of financial markets .
The buy-side has voiced simplification and automation as key focus areas within this environment . Algo strategies are being adopted with the goal of enabling high-touch traders to navigate market conditions dynamically , while ensuring algo strategies remain simple so that they can be correctly measured and compared . This year , The TRADE ’ s Algorithmic Trading Survey 2024 shows a little more promise and optimism than previous editions . Following on from the downward trends of 2023 , we have seen some upticks in ratings from buy-side traders who took part in this year ’ s survey .
While long-only managers have logged an overall rating of 5.81 , which is only marginally higher than last year , it is when we delve a little deeper that we observe some of the more interesting trends . Firstly , it is important to note that there has been a stark increase in ratings submitted in 2024 - a record year in fact across the survey ’ s 17-year history . Attention must be called to anonymity and execution consulting , both moving up 0.08 points , while cost has increased by an overall 11 basis points . Despite these significant increases , these categories are not our high scorers . Instead , taking the top spots this year , we have ease of use ( 5.97 ) and customer support ( 6.03 ).
In fact , customer support is the highest scoring category this year – almost returning to its 2022 height ( see figure 1 ). While last year , traders reported having a frustrating and challenging 12 months , it would seem that there is a little bit of light at the end of the tunnel .
There are only a handful of categories which have continued their downward trend this year , most notably being speed ( -0.60 ), and routing logic analysis ( -0.04 ). It is also worth noting that breadth of access to dark pools has seen a decline in its rating , moving down 0.05 since 2023 .
This is particularly interesting , as , looking through the respondent comments , a significant number of them ( 6 %) have reported that they are especially happy with their
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