[ S U R V E Y | A L G O R I T H M I C T R A D I N G ]
decrease, particularly customer support(-0.16) and ease of use(-0.15), indicating the growing expectations from the buy-side for brokers to provide more execution related services due to technology advancements, smartly source market liquidity in the AI era and measure the overall effectiveness of deployed strategies.
This is supported by the fact that the category of customisation features receives the lowest score over the past four years.
Factors for algorithmic usage Respondents’ reasons for using algorithms are presented in Figure 2 as a percentage of responses from 2024 to 2026. Over the past few years, we have seen truly minor change in the top reasons longonly respondents report for using algorithms, with approximately 43 % of traders citing ease of use, reducing market impact, consistent execution performance and increased trader productivity as their top four reasons.
Buy-side desks are seeking algorithms that minimise market impact and operate at higher speeds and lower latencies to remain competitive in fast-moving markets. This is paired with rising expectations for granular venue-level data and sophisticated routing logic analysis to inform smarter execution decisions. Unsurprisingly, three of the largest increases in responses were data on venue / order routing logic or analysis, higher speed, lower latency and reduced market impact.
While perhaps paradoxical at first glance, the areas showing the largest year-on-year decreases- better pricing( price improvement), ease of use and alignment of results with pre-trade estimates- have historically been core drivers
Figure 2. Reasons for using algorithms(% of responses) Feature |
2026 |
2025 |
2024 |
Ease of use |
11.10 |
11.66 |
12.51 |
Reduce market impact |
10.91 |
10.48 |
11.41 |
Consistency of execution performance |
10.55 |
10.74 |
10.71 |
Increase trader productivity |
10.26 |
10.20 |
10.60 |
Greater anonymity |
8.19 |
8.26 |
7.99 |
Higher speed lower latency |
7.60 |
6.85 |
7.48 |
Better prices( price improvement) |
6.94 |
7.64 |
7.07 |
Flexibility and sophistication of smart order routing |
6.86 |
7.21 |
7.19 |
Customisation capabilities |
6.83 |
6.57 |
6.10 |
Lower commission rates |
6.81 |
6.71 |
5.77 |
Algo monitoring capabilities |
6.77 |
6.91 |
6.58 |
Data on venue / order routing logic or analysis |
4.69 |
3.77 |
3.96 |
Results match pretrade estimates |
2.48 |
3.00 |
2.64 |
for algorithm usage. A deeper look reveals that the buy-side community now expects more from these fundamental functionalities.
While most brokers meet the minimum requirements, the demand is increasing for enhancements and innovations that extend and improve these basic capabilities. The two factors, better prices( price improvement) and data on venue / order routing logic or analysis, have always been on the bottom half of the reasons for algo adoption. The decrease in ease of use suggests that traders are frustrated with workflow friction and the operational overhead required to manage increasingly complex algo suites.
Ultimately, the message is straightforward: the buy-side is not abandoning algos, they are demanding more from them, pushing providers to evolve from delivering basic execution tools to offering intelligent, transparent and seamlessly integrated execution platforms.
Number of providers Very much in line with past surveys, we continue to see a positive correlation between a firm’ s AUM and the number of algo providers they use( Figure 3). Large
Figure 3: Average number of providers used by AUM( USD billions) |
AUM( billions USD) |
2026 |
2025 |
2024 |
Up to 0.25 |
2.30 |
2.88 |
2.82 |
0.25-0.5 |
2.70 |
2.23 |
2.50 |
0.5 to 1 |
2.29 |
3.06 |
2.91 |
1 to 10 |
3.40 |
3.03 |
3.04 |
10 to 50 |
3.81 |
4.16 |
5.14 |
More than 50 |
4.86 |
4.70 |
4.77 |
Not Answered |
4.00 |
3.20 |
3.90 |
62 // TheTRADE // Q1 2026