EghtesadOnline: The first round of algorithmic trade competitions in the capital market will soon be held by the Security and Exchange Organization.
Yasser Fallah, managing director of the SEO Information and Services Dept said the competitions will focus on promoting international trading norms, engaging IT experts and other financial elite in the capital market.
Plans include nurturing advanced concepts of the capital market, offering job opportunities to experts active in the field of algorithmic trade, introducing software capacities and new trading instruments, and enhancing the knowledge of stakeholders and players in the capital market, Financial Tribune reported.
"Given the rapid growth in financial markets, new requirements such as intelligent and automotive financial tools and robots for rapid and regular monitoring of the market also arise", he was quoted as saying by the Security and Exchange News Agency (SENA).
He recalled that a large portion of stock exchange transactions around the world are now done through algorithms and such developments have gained increasing attention in Tehran and are backed by supervisory bodies.
Algorithmic trading is the process of using computers programmed to follow a defined set of instructions (or algorithms) for placing a trade in order to generate profits at a speed and frequency that is impossible for a human trader.
The defined rules are based on timing, price, quantity or other mathematical models. Apart from profit opportunities for the trader, algo-trading makes markets more liquid and makes trading more systematic by removing the impact of human emotions on trading activities.
Elaborating the nature of the competitions, Fallah said groups of three (an IT expert, a financial expert and a supervisor) will compete for four business weeks.
"The competition is electronic in nature and is algorithm without direct involvement of humans", he said.
The event would be in three parts, namely "fixed income securities", "stock trading", and "problem-solving". The first two are continuous and the last is done once a week and the teams are not required to be present in all three phases.
Also "a proper initial credit is allocated to teams taking part in the first two sections, but credit for the third category would be allocated as the need arises and based on approval of the executive committee.”