Algorithmic Trading is the use of computer programs to execute trades in financial markets based on a set of predefined rules. These rules may include timing, price, quantity, or other mathematical models. AI-enhanced algorithmic trading, as seen in systems feeding into Hermes AI or Olympus AI, can adapt strategies in real-time based on news sentiment, volatility, or macroeconomic data. The advantage is precision, speed, and the ability to process information far faster than human traders. This reduces execution costs, minimizes market impact, and eliminates emotional decision-making. While algorithmic trading can be highly profitable, it requires rigorous backtesting, monitoring, and risk management to avoid unintended losses, particularly in volatile or illiquid markets.
