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AI and Machine Learning : Transformation in Trading Industry

Blog: NASSCOM Official Blog


Technology is a golden opportunity for any domain or industry, and for finance it has been a boon because it a direct link to profits.One of the gifts of technology is AI, which is creating a lot of impact in the world.AI and Machine Learning have become buzzwords within all verticals.

The question is why wouldn’t they? AI and ML provides solutions for all type of industry problems.

AI is doing extremely good in every industry especially FINANCIAL SERVICES.Banking and Insurance have already been taken over by technology, but what about financial markets?

AI in the near future will be shaping the stock trading sector.

How exactly AI can be used in trading?

Analysis of investors sentiments, news headlines , social media comments, and other sources on internet will be used by AI to forecast the moves of the different traders which will help in analyzing the sentiments of the market.

AI can be used to identify patterns by taking help of different data points, and help in identify the trend of the market which is traditionally done by various tools like candlesticks patterns etc.

AI is a fast paced technology which is functional oriented. This will help trading in fast manner and will not need human intervention.

Robots can be used to analyze millions of points in forecasting the prices automatically.


You might be surprised that a subset of AI ,Machine Learning is also gaining momentum with its algorithm trading strategies.

Trading is typically based on human emotions, but these decisions create greatest hindrance for the investors. But such algorithmic decisions makes execution faster and do not consider emotions at all.

ALGORITHMIC TRADING: Also known as Black-box trading , uses machine learning or a set of computer program that basically follows a set of computerized instructions to place a trade in a speedy manner to generate profits .




AI and ML driven trading technologies are already used by companies all over the world.

How they use it?

India is not behind anyone else in the world. NATIONAL STOCK EXCHANGE of India, launched Knowledge hub in January 2020, which is an artificial intelligence powered learning ecosystem.

The aim is to connect Digital India and the financial sector specially trading and the investment industry.

In 2018 as well,” I know First” AI based predicting system was launched which used its technology to forecast evaluation returns with the data fed. This system is used but it is not common.

Few companies in India are already transforming the stock market with the use of AI –

Today, retail financial specialists are quickly expanding in India. NSE has more than 3 crore investors, as they keep on developing with a CAGR of 11 percent since the previous decade. This figure is about 4.6 crore for BSE, which has enlisted a 26 percent year-on-year development throughout the most recent year itself.


In this way, the investor sentiment keeps on improving in India, the ascent of AI-driven full-administration broking will additionally prepare for unbridled efficiencies. Maybe, it will fill in as the genuine empowering influence of a financial fit country, beginning with 2020.

Brief Profile 

Palak Bhatnagar is a student , pursuing PGDM in Finance and Business Analytics at New Delhi Institute of Management , New Delhi . She is a finance enthusiast , a versatile person who likes to explore . She is a keen learner with an objective to learn and grow.


The post AI and Machine Learning : Transformation in Trading Industry appeared first on NASSCOM Community |The Official Community of Indian IT Industry.

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