Systematic Trading

Systematic trading is an investing discipline that involves quantitative research and technical market data. An analyst inputs the market conditions into a software application that would initiate a trade program once certain market conditions or parameters are met. An example of a parameter would be if two moving averages cross each other, it would indicate a technical signal to initiate the trades.

The trade programs are based on a set of well-defined rules that tells you when and what to buy or sell. There are various software vendors with special applications that monitor technical market data and alert the analyst or kick of these trade programs automatically. Proponents of this type of analysis believe that historical market conditions repeat over time; therefore, they trade on these conditions.

Systematic Trading