115 CFA
File: Portfolio Management - Reading 57 - 2. Fintech applications to investment management

2. Fintech applications to investment management

c. describe fintech applications to investment management;

What are robo-advisors?
Robo-advisors provide digital financial advice based on math rules or algorithms. These financial services include asset allocation, portfolio optimization, trade execution, rebalancing and tax strategies.

What is algorithmic trading?
Algorithmic trading (automated trading, black-box trading or simply algo-trading) is the process of using computers programed to follow a defined set of instructions (an algorithm) for placing a trade in order to generate profits at a speed and frequency that is impossible for a human trader.

What is high frequency trading (HFT)?
High frequency trading (HFT) attempts to capitalize on placing a large number of orders at very fast speeds across multiple markets and multiple decision parameters, based on preprogrammed instructions.

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