Algo trading, a short form for algorithmic trading, stands for trading various financial assets online with the help of various software. This means that there is no person behind the computer click buy and sell buttons, but the orders are executed by the algorithm that analyses the market for different patterns, and based on those, decides to perform a trade.
One of the main advantages of algo trading is that once you have a well-tested algorithm, you can easily leave it working and enjoy the profits it makes. Well, it may sound like this, but the reality is actually quite different. To have a fully working algorithm, once has to actually spend quite some time in front of the PC editing the trading strategy to make it work with the ever-changing market conditions.
Algo trading history
Automated trading has started gaining traction in early 2000’s, back then it was only used at the various stock brokers. Later, the technology started getting popular with many FX brokers, as the market was providing a much higher liquidity for the day traders. Quickly, automated trading has became popular with many binary options brokers, and today most of the trading volumes are actually generated by the robots than by the humans.
How to earn on algo trading?
First of all, you either need to be a software developer or you need to hire one in order to kick of with automated trading. Typically, in the FX market, one can develop robots using C# or MQL programming languages. Then, the speed of execution is certainly of a prime importance. You would need to rent a server at the trading exchange or get a VPS that has a very fast connection with some brokerage. This might be costly, as a trading server on such exchanges as Nasdaq may cost you over a $1,000 per month. Hence, you also require a significant capital to compensate for the hardware costs.
However, once you have a working script, established hardware, and some decent capital, you are ready to go.
Magazine : 
.jpg "PMP Institutes")