INTELLIGENT SOLUTIONS AND STRATEGIES FOR ALGORITHMIC TRADING ON THE STOCK MARKET

Abstract

The stable and effective functioning of capital markets is the basis for the optimal allocation of financial resources at the macro level. The stock market is a key player in the redistribution of financial assets, the prices of which are formed by integrating large amounts of information from various sources. The quality of information provided to stock market participants is determined by the use of technical and fundamental analysis. The article discusses modern digital transformations and intelligent solutions that significantly expand opportunities for capital market participants and, at the same time, create new challenges and threats in the context of data protection, information reliability, speed of information exchange, and response to situational changes. In the process of research, the following scientific methods were used: theoretical generalization (for analyzing publications by Ukrainian researchers); grouping and logical-structural modeling (for studying the relationship between intelligent solutions and strategies for algorithmic trading); logical generalization of results (for formulating conclusions). The article focuses on algorithmic trading as a modern technological approach to financial trading. For stock market participants, the ability to accurately predict and anticipate market conditions, taking into account influencing factors and trends, is crucial. Standard investor actions are automated through the use of intelligent analytical tools, such as trading bots or advisory systems that implement a given algorithm. The key task in algorithmic trading is to assess potential market behavior, considering the following factors: the specific asset being traded on the exchange; its history of listing and past transactions involving the asset; a set of financial tools to support trading in the asset; and estimating the probability of the asset’s future appearance on the market. Depending on the time, number of orders, and transaction volume, traders choose different strategies of behavior in trading. Algorithmic trading, combined with distributed ledger technology and artificial intelligence capabilities, allows for the pre-programming of a set of strategies, followed by the selection of the optimal strategy based on the specified parameters. Electronic methods of exchange trading, utilizing the rules of a given algorithm, allow for the automation of trade order entry and execution, as well as the analysis of market trends for risk management and the reduction of potential losses.