Definition 1

Automatic, computerized trading by institutional investors for large blocks of securities. Orders are signaled by the investors' or brokers' computers directly into the stock exchange's computers for execution.

Definition 2

Securities trading in which computers are programmed to continuously monitor current market prices and trends. If the computer finds a price difference or market situation which meets certain conditions, a buy and/or sell order is automatically triggered without human intervention. After the last of Black Mondays, the exchanges employing program trading systems have instituted circuit breakers to stop automated trading and thus prevent free-fall in market prices.

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