aster.cloud aster.cloud
  • /
  • Platforms
    • Public Cloud
    • On-Premise
    • Hybrid Cloud
    • Data
  • Architecture
    • Design
    • Solutions
    • Enterprise
  • Engineering
    • Automation
    • Software Engineering
    • Project Management
    • DevOps
  • Programming
    • Learning
  • Tools
  • About
  • /
  • Platforms
    • Public Cloud
    • On-Premise
    • Hybrid Cloud
    • Data
  • Architecture
    • Design
    • Solutions
    • Enterprise
  • Engineering
    • Automation
    • Software Engineering
    • Project Management
    • DevOps
  • Programming
    • Learning
  • Tools
  • About
aster.cloud aster.cloud
  • /
  • Platforms
    • Public Cloud
    • On-Premise
    • Hybrid Cloud
    • Data
  • Architecture
    • Design
    • Solutions
    • Enterprise
  • Engineering
    • Automation
    • Software Engineering
    • Project Management
    • DevOps
  • Programming
    • Learning
  • Tools
  • About
  • Tech

Computers Manage More Stocks Than Humans Do

  • root
  • January 9, 2020
  • 2 minute read

Computers completely overtook humans in terms of the proportion of stocks being managed. This is what is revealed by a recent study of The Economist.

 


Partner with aster.cloud
for your next big idea.
Let us know here.



From our partners:

CITI.IO :: Business. Institutions. Society. Global Political Economy.
CYBERPOGO.COM :: For the Arts, Sciences, and Technology.
DADAHACKS.COM :: Parenting For The Rest Of Us.
ZEDISTA.COM :: Entertainment. Sports. Culture. Escape.
TAKUMAKU.COM :: For The Hearth And Home.
ASTER.CLOUD :: From The Cloud And Beyond.
LIWAIWAI.COM :: Intelligence, Inside and Outside.
GLOBALCLOUDPLATFORMS.COM :: For The World's Computing Needs.
FIREGULAMAN.COM :: For The Fire In The Belly Of The Coder.
ASTERCASTER.COM :: Supra Astra. Beyond The Stars.
BARTDAY.COM :: Prosperity For Everyone.

35.1% of the US stock market is now being managed by algorithms. Meanwhile, 24.3% of the stock market is still being handled by humans.

The remaining portion of the stock market are assets held by companies (15.3%) and other owners such as governments, insurance, and foreigners  (25.3%).

In order to come up with these statistics, The Economist studied US$31 trillion worth of equities and checked which entity governs each portion.

Understandable shift

The stock market is an extremely volatile environment which demands constant supervision and quick decision making. There is a lot of risks involved when it comes to handling stocks. A single misstep could cost a fortune or possibly even the collapse of the entire market.

Until recently, stock trading has been a human-centric affair. While this has worked for quite a while, there are still instances that humans commit grave errors and misjudgment.

This is why it is perfectly understandable why there is a preference for automated stock management. Through algorithmic trading, human error is eliminated and all relevant factors when making stock-related decisions are all easily taken into account.

By modelling stock trade information, valuable predictions can also be made by these algorithms, something that humans cannot replicate.

The number one risk

While all seems to be good when it comes to the use of algorithms for managing passive equities, there are some who remains to be skeptical about its credibility.

Read More  Fast Restart: A Powerful New Tool To Help Improve SAP HANA Uptime

Torsten Slok, chief international economist at Deutsche Bank, listed the risks to look out for in the stock market:

Number one in the list is “algo-driven, risk-parity driven fire sale in equities and credit discontinues.”

Especially with its current sphere of influence, algorithmic trading has the potential to spark huge, concentrated equity sell-offs. During times of market swings, volatility can be worsened due to this.

The fear of the critics of algorithmic trading is that its data centrism might eventually lead to extremely bad decisions that can ruin the stock market. This is a sentiment echoed by Omega Advisors CEO Leon Cooperman in his discussion of market volatility.

While modelling the stock market behaviour using sophisticated statistical models are beneficial in gaining insights, the results of these models should of course not be taken as absolutes. In the end, these models can still yield erroneous results.

With this in mind, the results of these algorithms should be taken as guides that are used along with human understanding to make the best decisions. Just by relying on one or the other will end up badly.

While it does in no way completely eliminate tot take big risks, it is in the synergy of the human experience and the computing power of these algorithms where the optimal decisions when it comes to the stock market can be found.


For enquiries, product placements, sponsorships, and collaborations, connect with us at [email protected]. We'd love to hear from you!

Our humans need coffee too! Your support is highly appreciated, thank you!

root

Related Topics
  • Algorithms
  • Finance
  • Market
  • Stock Market
You May Also Like
Getting things done makes her feel amazing
View Post
  • Computing
  • Data
  • Featured
  • Learning
  • Tech
  • Technology

Nurturing Minds in the Digital Revolution

  • April 25, 2025
View Post
  • Tech

Deep dive into AI with Google Cloud’s global generative AI roadshow

  • February 18, 2025
Volvo Group: Confidently ahead at CES
View Post
  • Tech

Volvo Group: Confidently ahead at CES

  • January 8, 2025
zedreviews-ces-2025-social-meta
View Post
  • Featured
  • Gears
  • Tech
  • Technology

What Not to Miss at CES 2025

  • January 6, 2025
View Post
  • Tech

IBM and Pasqal Plan to Expand Quantum-Centric Supercomputing Initiative

  • November 21, 2024
Black Friday Gifts
View Post
  • Tech

Black Friday. How to Choose the Best Gifts for Yourself and Others, Plus Our Top Recommendations.

  • November 16, 2024
zedreviews-Apple-iPhone-16-Pro-finish-lineup-240909
View Post
  • Featured
  • Gears
  • Tech
  • Technology
  • Tools

Apple debuts iPhone 16 Pro and iPhone 16 Pro Max

  • September 10, 2024
zedreviews-Apple-iPhone-16-Apple-Intelligence-240909
View Post
  • Featured
  • Gears
  • Tech
  • Technology

Apple introduces iPhone 16 and iPhone 16 Plus

  • September 10, 2024

Stay Connected!
LATEST
  • college-of-cardinals-2025 1
    The Definitive Who’s Who of the 2025 Papal Conclave
    • May 7, 2025
  • conclave-poster-black-smoke 2
    The World Is Revalidating Itself
    • May 6, 2025
  • 3
    Conclave: How A New Pope Is Chosen
    • April 25, 2025
  • Getting things done makes her feel amazing 4
    Nurturing Minds in the Digital Revolution
    • April 25, 2025
  • 5
    AI is automating our jobs – but values need to change if we are to be liberated by it
    • April 17, 2025
  • 6
    Canonical Releases Ubuntu 25.04 Plucky Puffin
    • April 17, 2025
  • 7
    United States Army Enterprise Cloud Management Agency Expands its Oracle Defense Cloud Services
    • April 15, 2025
  • 8
    Tokyo Electron and IBM Renew Collaboration for Advanced Semiconductor Technology
    • April 2, 2025
  • 9
    IBM Accelerates Momentum in the as a Service Space with Growing Portfolio of Tools Simplifying Infrastructure Management
    • March 27, 2025
  • 10
    Tariffs, Trump, and Other Things That Start With T – They’re Not The Problem, It’s How We Use Them
    • March 25, 2025
about
Hello World!

We are aster.cloud. We’re created by programmers for programmers.

Our site aims to provide guides, programming tips, reviews, and interesting materials for tech people and those who want to learn in general.

We would like to hear from you.

If you have any feedback, enquiries, or sponsorship request, kindly reach out to us at:

[email protected]
Most Popular
  • 1
    IBM contributes key open-source projects to Linux Foundation to advance AI community participation
    • March 22, 2025
  • 2
    Co-op mode: New partners driving the future of gaming with AI
    • March 22, 2025
  • 3
    Mitsubishi Motors Canada Launches AI-Powered “Intelligent Companion” to Transform the 2025 Outlander Buying Experience
    • March 10, 2025
  • PiPiPi 4
    The Unexpected Pi-Fect Deals This March 14
    • March 13, 2025
  • Nintendo Switch Deals on Amazon 5
    10 Physical Nintendo Switch Game Deals on MAR10 Day!
    • March 9, 2025
  • /
  • Technology
  • Tools
  • About
  • Contact Us

Input your search keywords and press Enter.