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Lingo topic · 16 terms

Algo and automated trading

Robots, backtests and expert advisors.

A

Algorithmic TradingTrading where a computer program decides and places orders according to pre-set rules.
Application Programming InterfaceA doorway that lets one piece of software talk to another, such as your trading bot talking to your broker.

E

E-Trading DeskThe team at a bank that runs its electronic pricing and trading, where algorithms quote and fill most client orders.
Electronic Market MakerA firm that uses algorithms to quote buy and sell prices continuously, earning the spread across huge numbers of trades.
Expert AdvisorAn automated trading program that runs inside the MetaTrader platform and can open and manage trades by itself.

F

FIX APIA standard messaging language for sending orders and receiving prices, used by banks, funds and some advanced retail traders.

H

High-Frequency TradingComputer-driven trading that places huge numbers of orders in fractions of a second to profit from tiny price differences.

L

M

Mechanical TradingTrading by a fixed set of rules for entries, exits and size, with no gut calls allowed.

P

Q

Quantitative AnalysisUsing maths, statistics and data to find and test trading ideas, instead of gut feel or narrative.

S

Smart Order RoutingSoftware that automatically sends each order to whichever venue or liquidity provider offers the best price and fill.

T

Time-Weighted Average PriceAn execution method that splits a big order into equal slices spread evenly over a set time period.

V

VWAPThe average price an asset traded at during a period, weighted by how much traded at each price; also an execution algorithm that targets it.

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