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Algo Trading, also known as Black-box trading, involves using computer software programs to place trades without human involvement. While Algo trading may lead to substantial profits, it's essential that investors understand its associated risks before engaging in this form of automated trading.

Algo Trading's primary advantage lies in its speed. Algorithmic traders can execute orders faster than human traders and double-check that orders are being executed correctly - an advantage not enjoyed by humans who may misjudge technical indicators or analyse them incorrectly; computers simply do not make these mistakes!

https://wikimapia.org/external_link?url=https://elitealgo.in/algo-trading-strategies/ Trading's speed can also help minimize costs by speeding execution time and limiting market impact, while running algorithms on multiple servers in parallel enables increased volumes and improved execution efficiency.

One drawback of Algo Trading is its increased stress level compared to manual trading; since an algorithmic strategy's success depends on its design and implementation - something which can be highly unpredictable.

Due to this reason, it is vitally important that any trading strategy be thoroughly tested and backtested prior to being applied in live markets. Furthermore, regular monitoring and adjustments of strategies must also take place so as to accommodate for changing market conditions.