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Stream/Area:
-
Subject:
-
Paper ID:
IJSREM62190
Volume:
10 |
4 |
April 2026
Pages:
1-5
Publication Frequency:
Monthly (12 issues per year)
License:International Journal of Scientific Research in Engineering and Management follows the Creative Commons Attribution 4.0 (CC BY 4.0) License, allowing free use and distribution with proper attribution.
MBA
Hindusthan college of engineering and technology ,Coimbatore tamil nadu
MBA
Hindusthan college of engineering and technology ,Coimbatore tamil nadu
The rapid integration of advanced technologies into financial markets has significantly transformed trading practices, with algorithmic trading emerging as a dominant force alongside traditional human-driven trading. This study provides a comprehensive comparative analysis of algorithmic trading and human-driven trading, focusing on their performance metrics and impact on market conditions such as liquidity, volatility, and price discovery. Using an analytical and comparative research design based on secondary data from stock and derivative markets, the study evaluates key variables including execution speed, profitability, accuracy, adaptability, and market stability. The findings reveal that algorithmic trading excels in speed, accuracy, consistency, and improving market liquidity and price efficiency. However, it may contribute to increased volatility during uncertain market conditions. Conversely, human-driven trading demonstrates superior adaptability, qualitative judgment, and the ability to handle complex and unexpected market events, although it is prone to emotional biases and inconsistent performance. The study rejects the null hypotheses that there is no significant performance difference and that algorithmic trading does not impact volatility, confirming the distinct strengths and limitations of each approach. The research concludes that a hybrid model combining the efficiency of algorithms with human oversight is the most effective strategy for achieving optimal performance and maintaining market stability.
KEYWORDS
In conclusion, the study highlights that algorithmic trading and human-driven trading each play a vital role in modern financial markets. While algorithmic trading offers speed, efficiency, and consistency, human trading provides flexibility, intuition, and the ability to handle complex situations. The statistical analysis rejected the null hypotheses, confirming a significant difference in performance between the two approaches and a notable impact of algorithmic trading on market volatility. Human trading also demonstrated a significant contribution to market stability, especially during uncertainty. Neither approach can completely replace the other. A balanced integration of both approaches is essential for achieving optimal performance and maintaining market stability. The growing dominance of automation suggests algorithmic trading will continue to shape future markets, but human oversight remains indispensable.
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Publication Date
5/2/2026
Peer Review Type
Double-Blind Peer Review
Review Rounds: 2
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