Algorithmic Trading Jobs - What Are They and How to Get One

Algorithmic trading involves trading in equities, currencies, or other financial instruments using computer programs. A trading program uses an algorithm to calculate current market conditions. This trading method is automated, so the program buys or sells the financial instrument when the algorithm says that the market meets all the requirements for a profitable trade. To create an algorithm, you perform mathematical and statistical analysis, also known as quantitative analysis, on an exchange or equity. After creating an algorithm with defined trading rules, you test it using historical market data. While this is primarily a technical field, you also need an understanding of the market.

The qualifications that you need to start a career in algorithmic trading include a degree, analytical skills, knowledge of financial markets, mathematical abilities, and experience with computer programming. Financial institutions seek applicants with a bachelor’s degree in statistics, math, computer science, finance, or another related field. If you work as a developer, you need training or demonstrable ability in C#, C++, or Python, which are the most common languages for algorithmic trading programs. You can build a portfolio of past work to show potential employers. Some banks and hedge funds seek applicants with a master’s degree in statistical analysis or equivalent experience.

Careers in algorithmic trading include algorithmic traders, quantitative traders, quantitative analysts, algorithmic trading developers, and statisticians. In the finance industry, people often refer to algorithmic traders and developers as “quants.” In these careers, your duties and responsibilities include performing statistical analysis on stocks, funds, or currencies and then writing algorithms and programs using computer languages like C# or Python. A quant can work for a bank, a hedge fund, a software company, or a consulting firm. You can also trade privately. You can create algorithms for equity markets, foreign exchange markets, or cryptocurrency markets.