Automated Algo Trading Market Poised for Rapid Growth, Reaching $35B by 2031

The global automated algo trading market is projected to reach $35 billion by 2031, growing at a 10.1% CAGR from 2022 to 2031. The solution segment dominated the market in 2021, but the service segment is expected to experience the fastest growth through 2031.

Bijay Laxmi
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Automated Algo Trading Market Poised for Rapid Growth, Reaching $35B by 2031

Automated Algo Trading Market Poised for Rapid Growth, Reaching $35B by 2031

The global automated algo trading market is set for significant expansion in the coming years, with projections indicating it will reach a staggering $35 billion by 2031. A recent report by Allied Market Research forecasts the market will grow at a robust Compound Annual Growth Rate (CAGR) of 10.1% from 2022 to 2031.

Why this matters: The growth of automated algo trading has significant implications for the financial industry, as it can lead to increased efficiency and reduced costs for investors. As more institutions adopt algorithmic trading, it may also lead to changes in market dynamics and potentially impact job roles in the financial sector.

In 2021, the automated algo trading market generated $13.5 billion globally. The solution segment captured the lion's share, accounting for three-fourths of the worldwide market. However, the service segment is predicted to experience the fastest growth, with a CAGR of 14.1% through 2031.

The on-premises deployment model dominated in 2021, holding over four-fifths of the global market share. But the cloud segment is expected to exhibit the highest CAGR of 14.5% during the forecast period. Large enterprises were the top adopters, accounting for more than three-fourths of the market in 2021, while small and medium-sized enterprises (SMEs) are projected to see the fastest uptake at a 13.3% CAGR.

Among the various applications, trade execution held the highest market share in 2021 at nearly two-fifths. Liquidity detection is anticipated to grow the quickest, with a 12.1% CAGR through 2031. Geographically, the Asia-Pacific region is poised to lead the global market in 2031 with a one-third share and the fastest regional growth at a 12.7% CAGR.

The COVID-19 pandemic had a limited impact on the automated algo trading market, as the shift towards algorithmic trading solutions accelerated. "The rise in shift towards algorithmic trading activities for taking quick decisions and minimizing human errors during the pandemic contributed majorly towards the global market size during the COVID-19 pandemic," the report stated.

Key players in the automated algo trading market include 63MOONS, AlgoTrader, Argo Software Engineering, Ava Trade Markets Ltd, Software AG India, Algo Tata Consultancy Services Limited, InfoReach Inc, LEHNER INVESTMENTS, MetaQuotes Ltd, NinjaTrader, QuantConnect, Symphony, Tethys Technology, VIRTU Financial Inc, Next Algo, and Myalgomate Technologies LLP. These companies are leveraging strategies such as joint ventures, collaborations, expansions, new product launches, and partnerships to strengthen their industry foothold.

The Allied Market Research report offers valuable insights for stakeholders, providing a quantitative analysis of market segments, current trends, estimations, and dynamics of the automated algo trading market from 2021 to 2031. It also examines the recent developments, product portfolios, business performance, and operating segments of prominent market players.

Key Takeaways

  • Automated algo trading market to reach $35 billion by 2031, growing at 10.1% CAGR.
  • Solution segment dominated in 2021, but service segment to grow fastest at 14.1% CAGR.
  • Cloud segment to exhibit highest CAGR of 14.5% during the forecast period.
  • Liquidity detection to grow quickest at 12.1% CAGR, while Asia-Pacific region to lead globally.
  • Key players leveraging strategies like joint ventures and partnerships to strengthen industry foothold.