Definition

1. Noun:
   • A securities trading technique: "program trading" is a method of trading large quantities of securities, typically stocks, where the decision to initiate trades is generated by computer algorithms based on predefined criteria. It often involves the simultaneous or near-simultaneous execution of trades in a basket of stocks.

Usage Examples

• Noun:
  • The market volatility was exacerbated by a surge in program trading.
  • Many large institutional investors use program trading to execute their strategies efficiently.

Advanced Usage

• "to be driven by program trading": to be significantly influenced by automated trading systems.
  • The rapid price swings were largely driven by program trading.

Variants and Related Words

• Algorithmic trading (n): A broader term for trading systems that use computer algorithms to execute orders, often used synonymously with program trading.
• High-frequency trading (HFT) (n): A subset of algorithmic trading characterized by extremely high speeds and large numbers of trades.

Synonyms

• Automated trading: Trading executed automatically by computer systems.
• Systematic trading: Trading based on a fixed set of rules or a system.

Related Phrases

• Portfolio insurance: A specific strategy often associated with program trading in the 1980s, designed to hedge portfolio risk, which sometimes uses program trading techniques.

Related Idioms

Noun

1. a trading technique involving large blocks of stock with trades triggered by computer programs