Does the sell-side acceptance of algorithmic trading mean it acknowledges a reduced value to the trading function?
AZ: This depends on the angle at which one views algorithmic execution and “traditional” trading. If viewed as antipodal, we notice that the increase in automated trading, to a certain degree, diminishes the need for manual one. However, if trading is viewed as a single process that combines both automated and manual execution of orders as various means of getting the work done, then the overall value to the trading function is there and it is increasing. I see both types of trading as part of the bigger picture. What will make the buy side significantly increase its adoption of algorithmic trading? AZ: Just as we had a chance to witness it happen with other products and services in the past, commoditizing will do the trick. Availability, accessibility, cost and marketing of execution algorithms will make them more common components of the buy-side trading practice. Will automatic execution strategies become the norm for the buy side? Eric Goldberg, Portware: As the buy side takes more
