In a recent interview, Singapore Exchange Regulation (SGX RegCo) CEO Tan Boon Gin says none of the brokers who implemented algo trading have suffered any significant losses during the period. There were also no cases of nefarious trading manipulation. This, he adds, is the result of robust internal controls put in place by many brokers.
The Covid-19 pandemic may have roiled the Singapore stock market over much of this year, but many traders took advantage of the volatility. This led to a surge in algorithmic (algo) trading, which is a method of executing orders in the market using pre-programmed trading instructions.
While algo trading allows investors to employ certain trading strategies that cannot be executed easily through conventional means, the risk of incurring losses is higher if the market moves against them or adequate controls are not put in place.
