Nasdaq’s AI-Powered Trading Mechanism Receives SEC Approval
Nasdaq has obtained approval from the Securities and Exchange Commission (SEC) to launch its “Dynamic Midpoint Extended Life Order,” a new order type that utilizes artificial intelligence (AI) to match buyers and sellers who hope to hold stocks for longer durations. In contrast to the traditional approach of fixed waiting periods, Nasdaq’s A.I. adjusts waiting times based on real-time market conditions, resulting in a 20% increase in fill rates and an 11% reduction in unwanted trades during tests. By analyzing over 140 factors, the technology suggests optimal holding periods, minimizing the impact of trading on stock prices and efficiently connecting long-term investors.
Nasdaq’s Commitment to Innovation
Nasdaq President Tal Cohen expressed the exchange’s dedication to delivering innovative products and tools that expand the quality of their markets and benefit all market participants. Along with the AI-powered order type, Nasdaq has likewise implemented A.I. in its options markets to predict probable new options contracts that are likely to trade, improving liquidity while maintaining the same number of listed contracts. This integration of advanced technology reflects both traditional finance and cryptocurrency exchanges’ ongoing efforts to modernize and provide quicker and more efficient trading experiences for investors.
Hot Take
The SEC’s approval of Nasdaq’s A.I. order type demonstrates the increasing adoption of advanced technology in the financial industry. As both traditional and cryptocurrency exchanges leverage A.I. tools, we can expect further advancements to strengthen market efficiency and provide new doors for traders and investors.
Benito Cormi, the brilliant crypto analyst who has made waves in the world of cryptocurrency. With his razor-sharp analytical skills and deep understanding of the digital asset landscape, Benito has become a trusted figure in the industry and remains at the forefront, tirelessly researching and analyzing market trends to help individuals and businesses make informed decisions in this dynamic landscape.
