Question

Are ATPs (Automated Trading Platforms) going to be a threat to the existence of human brokers?

Answer 1

Answer: Automated Trading Platforms- As the name suggests, this is an automatic trading platform where trading is done automatically. It is also called, "Algorithmic trading, mechanical trading or system trading". It allows traders and investors to establish specific rules for trade entries and exit, that is programmed once and can be traded automatically. It is very popular in USA.

Automated Trading Platforms is threat to the existence of human brokers- Yes it is a threat for brokers and dealers. Its disadvantages for brokers and traders are as following:

1. Any discrepancy in internet connection, power cut, computer crash and other technological or electrical disorder will stop the automatic trading in the middle and it can result in huge loss of traders and investors.
2. There are many brokers in USA, Automated Trading Platforms will force them to shut their broking firms, they will go jobless when machines will be used in place of them. They have already invested funds into setting up the broking firm now when Automated Trading Platforms will be used, they will be in huge loss.