What is the primary feature of algo trading?

The primary feature of algorithmic trading, or algo trading, is its reliance on automated systems that execute trades based on predefined criteria. This means that once the parameters are set, trades are carried out without human intervention, allowing for high-speed execution and the ability to capitalize on market opportunities that may arise in fractions of a second. This characteristic is essential for many trading strategies that require quick reactions to market movements, data signals, or other algorithms.

In contrast to the choice that emphasizes emotional trading decisions, algo trading specifically removes emotions from the equation, leading to more disciplined and systematic trading behaviors. The focus is also not on mere speculation or trading in physical products; rather, algo trading can be applied across a variety of asset classes, including equities, currencies, and derivatives, among others. Thus, the absence of human intervention is a defining aspect that sets algo trading apart in the modern financial markets.