PUBLISHER: The Business Research Company | PRODUCT CODE: 1429717
PUBLISHER: The Business Research Company | PRODUCT CODE: 1429717
Algorithmic trading is a methodology employing scripted computer codes and algorithms to execute transactions according to predetermined rules Programed into a computer system. This approach serves to minimize transaction costs and prevent substantial price fluctuations.
The primary categories of algorithmic trading encompass stock market trading, foreign exchange (forex), exchange-traded funds (ETFs), bonds, and other financial instruments. A stock market represents a platform where buyers and sellers engage in the exchange of equity shares from public corporations. The key elements involved in algorithmic trading are solutions and services designed for programming, debugging, data extraction, back-testing, optimization, and risk management functions. These tools find application among institutional investors, long-term traders, and short-term traders alike.
The algorithmic trading market research report is one of a series of new reports from The Business Research Company that provides algorithmic trading market statistics, including algorithmic trading industry global market size, regional shares, competitors with algorithmic trading market share, detailed algorithmic trading market segments, market trends, and opportunities, and any further data you may need to thrive in the algorithmic trading industry. This algorithmic trading market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.
The algorithmic trading market size has grown rapidly in recent years. It will grow from $18.22 billion in 2023 to $20.52 billion in 2024 at a compound annual growth rate (CAGR) of 12.6%. The expansion witnessed in the historical period can be credited to robust growth in emerging markets, a heightened demand for swift, dependable, and efficient order execution, escalating government regulations, the proliferation of digitalization, and an increased need for computing devices such as PCs and laptops.
The algorithmic trading market size is expected to see rapid growth in the next few years. It will grow to $33.87 billion in 2028 at a compound annual growth rate (CAGR) of 13.3%. Forecasted growth is fueled by government support, global population rise, urbanization, increased internet penetration, and the uptake of algorithmic trading. Key trends involve leveraging AI for data-driven channels, strategic collaborations, acquisitions for expansion, and developing advanced solutions to strengthen market positions.
The anticipated growth in the algorithmic trading market is expected to be propelled by the increasing penetration of the internet. As internet usage continues to rise globally, providing people with access to online platforms for information and knowledge about online trading, the algorithmic trading market stands to benefit. Online trading relies heavily on internet connectivity, and the surge in internet penetration is likely to support market growth. For instance, as of the beginning of 2023, an estimated 5.16 billion individuals worldwide, equivalent to 64.4% of the global population, were using the internet, according to DataReportal. In India, there were 692 million active internet users in July 2022, with projections indicating an increase to 900 million users by 2025. This trend underscores the significant role of increasing internet penetration in driving the algorithmic trading market forward.
Government support is anticipated to be a key driver of growth in the algorithmic trading market. Governments worldwide are actively supporting the trading sector to develop innovative solutions that better serve the industry. For example, in December 2022, Chinese authorities prepared to launch the state-controlled 'China Digital Asset Trading Platform' in collaboration with various entities, facilitating the trading of non-fungible tokens (NFTs) and other digital assets. Similarly, the UK initiated live testing of crypto blockchain technology in June 2022, focusing on financial market activities such as trading and settlement, as part of its efforts to become a global crypto hub. The UK is actively creating a favorable regulatory environment to attract investments and promote the use of blockchain technology and crypto assets. Consequently, government support is expected to drive advancements in the trading industry, leading to increased demand for the algorithmic trading market.
A prominent trend gaining traction in the algorithmic trading market is the emphasis on product innovations. Major players in the market are directing their efforts towards creating cutting-edge products as a strategic approach to maintain their positions. Illustratively, in July 2021, Rain Technologies, Inc., a technology company based in Canada, introduced RAIN TRADER. This web-based platform is designed to offer automated trading and algorithmic trading models, providing individuals with the opportunity to engage in hassle-free and fully automated algorithmic trading.
Companies operating in the algorithmic trading market are placing a strong focus on leveraging new technologies and developing technologically advanced solutions to bolster their market standing. An example of this is Octanom Tech, an InvesTech company based in India, which, in January 2023, unveiled the first artificial intelligence-backed platform named 'Hedged.' This platform provides investment and trading solutions to retail investors, offering hedged options trades driven by proprietary algorithms. 'Hedged' also features curated micro-sized investment funds with built-in hedges, aiming to safeguard investors' wealth from market volatility. This strategic approach of introducing innovative products aligns with the broader trend in the algorithmic trading market, where companies seek to stay competitive by offering advanced and technologically sophisticated solutions.
In March 2022, Trading Technologies International Inc., a leading US-based technology company specializing in professional trading software, infrastructure, and data solutions, successfully acquired RCM-X for an undisclosed sum. This strategic acquisition serves to enhance Trading Technologies' product portfolio, particularly in the areas of algorithmic execution strategies, trade analytics, and Transaction Cost Analysis (TCA) services. The integration of RCM-X's expertise and offerings is aimed at further elevating the overall customer experience for Trading Technologies. RCM-X, a financial technology company based in the United States, is recognized for its development of algorithmic execution strategies and quantitative trading products.
Major companies operating in the algorithmic trading market report are Virtu Financial Inc., IG Group Holdings PLC, FXCM Group, London Stock Exchange Group PLC, Trade Station, Software AG, Wyden (Algo Trader AG), Symphony Fintech Solutions Pvt Ltd., MetaQuotes Software Corp, 63 Moons Technologies Limited, iRage Capital, AlphaGrep, Kivi Capital, Mansukh Securities, Algoji, Tickeron, Inc., 1000pip Climber Robot, Build Alpha, Coinrule, Trality, IntoDarkness, Hugh, Curate, Avaloq Blockchain, Glencore (GLEN), Barclays, Prudential, Lloyds Banking Group, DTI Algorithmic, BitOasis, Gath3r, MidChains, HAYVN, XTX Markets, ActiveViam, Redline Trading Solutions, Inc., J.P. Morgan, Capital Group, Goldman Sachs, Zen Trading Strategies, SmarttBot, ATOM S/A, Ultrapar Participacoes, Banco Bradesco S.A, Itau Unibanco, Interactive Brokers, AVAtrade, eTORO, Arabeya Online, CalBank PLC, Plus500, XTB, Saxo Bank, City Index
North America was the largest region in the algorithmic trading market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the algorithmic trading market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
The countries covered in the algorithmic trading market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Spain, Canada.
Algorithmic trading includes revenues earned by entities by providing automated trading services, financial services, trade executions, and system architecture management. The market value includes the value of related goods sold by the service provider or included within the service offering.
The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).
The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.
Algorithmic Trading Global Market Report 2024 from The Business Research Company provides strategists, marketers and senior management with the critical information they need to assess the market.
This report focuses on algorithmic trading market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.
Where is the largest and fastest growing market for algorithmic trading? How does the market relate to the overall economy, demography and other similar markets? What forces will shape the market going forward? The algorithmic trading market global report from the Business Research Company answers all these questions and many more.
The report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market's historic and forecast market growth by geography.
The impact of sanctions, supply chain disruptions, and altered demand for goods and services due to the Russian Ukraine war, impacting various macro-economic factors and parameters in the Eastern European region and its subsequent effect on global markets.
The impact of higher inflation in many countries and the resulting spike in interest rates.
The continued but declining impact of covid 19 on supply chains and consumption patterns.