Program Trading


DEFINITION of 'Program Trading'

Computerized trading used primarily by institutional investors typically for large-volume trades. Orders from the trader's computer are entered directly into the market's computer system and executed automatically.

BREAKING DOWN 'Program Trading'

Program trades are usually executed if index prices sink or rise to a certain level. This tends to create very volatile situations. As a result, there are restrictions on times when program trading can be used.

  1. Algorithm

    A set of rules for accomplishing a task in a certain number of ...
  2. Index

    A statistical measure of change in an economy or a securities ...
  3. Neural Network

    A series of algorithms that attempt to identify underlying relationships ...
  4. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  5. Fuzzy Logic

    A mathematical logic that attempts to solve problems by assigning ...
  6. Basket Trade

    An order to buy or sell a group of securities simultaneously. ...
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