Significance of Automatic trades

annabell51 · Nov 24, 2008

Apologies if this is has been answered elsewhere but my search did not pick any thing up... this is probably a very basic question so do not shoot me down in flames please!
is there any more significance to Automatic Trades than non-automatic trades when looking at the live data?

Annabell

rnicoll · Nov 24, 2008

I'm not sure I'd call them more or less significant. Automated trades tend to be trying to exploit inefficiencies in the market, while manual traders tend to be more fundamental analysis based, IMHO, but that's about it...

Rhody Trader · Nov 24, 2008

rnicoll said:
... while manual traders tend to be more fundamental analysis based, IMHO,...

That's certainly not true. Among the short-term traders most trading is done based on news and technicals. The longer-term set has a bias more fundamentals.

It's worth noting too that the algo (auto) trading systems aren't just arbing. They also cover pretty much anything that can be quantified, including news.

annabell51 · Nov 24, 2008

Rhody Trader said:
That's certainly not true. Among the short-term traders most trading is done based on news and technicals. The longer-term set has a bias more fundamentals.

It's worth noting too that the algo (auto) trading systems aren't just arbing. They also cover pretty much anything that can be quantified, including news.

so......... if there are mostly auto trades and minimal manual trades is this a stronger trend than the other way round?

Rhody Trader · Nov 24, 2008

annabell51 said:
so......... if there are mostly auto trades and minimal manual trades is this a stronger trend than the other way round?

Is what a stronger trend?

As for their being more auto trades than manual, I'd want to see some figures proving that. Keep in mind that the market's biggest players (Fidelity, etc.) are not trading automatically.

annabell51 · Nov 24, 2008

Rhody Trader said:
Is what a stronger trend?

As for their being more auto trades than manual, I'd want to see some figures proving that. Keep in mind that the market's biggest players (Fidelity, etc.) are not trading automatically.[/QUOTE

thank you so much for taking the time to respond - I think what I really don't understand is how the auto trades are triggered and whether any special significance should be put on those rather than the manual ones? Maybe I am reading too much into this...........

Rhody Trader · Nov 25, 2008

Auto trades are triggered by a wide variety of things. Some are arbs where they look for pricing discrepencies between markets and/or instruments. Others work off news. Others use technicals. I wouldn't get too caught up thinking about it.

annabell51 · Nov 25, 2008

thanks ..... I really appreciate your time spent in answering my query.

Significance of Automatic trades

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