Algorithms Overseas

摘要

Electronic trading is on the rise in almost every market across the globe, and, not surprisingly, so is algorithmic trading. But, in the most general terms, European adoption of algorithms lags about two to three years behind their adoption in the United States, and adoption in Asia is perhaps a year further behind Europe, experts say. According to Westborough, Mass.-based TABB Group, about 13 percent of all order flow in the U.S. passes through algorithms; the total for Europe, Asia and Canada combined is just 3 percent. Given the unique requirements of each market, however, this disparity should not come as a surprise. It would be naive to assume that it is possible to simply apply algorithms that have been tried and tested in the U.S. market to say, the South Korean market. Even as the globalization of markets and standardization of electronic communications protocols have softened once-hard barriers between national markets, the patterns of algorithm use and adoption overseas cannot mimic those in the United States. Regulatory and structural differences still persist among the U.S., European and Asian markets, and among national markets on the continents. As a result (and as always), before entering a new market, it is critical to know the territory.