The use of trading systems, in general, is an
effective alternative to increase the liquidity of financial markets without,
however, raise the speculative risk relatively.
According to a study published in "The Journal of
Finance" in February 2011 entitled "Does Algorithmic Trading Improve Liquidity?" Provides a study which argues that the use of trading systems in the U.S.
market enhances liquidity and informativeness of orders. In their study
estimates that for large stocks in particular, the use of trading systems
narrow spreads, reduce adverse selection and reduces the uncovered positions.
