Program Trading

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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.

INVESTOPEDIA EXPLAINS'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.

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