Algorithmic trading now accounts for 60-80% of all equity volume in the US. Astonishing.
I wonder... since algo trading is basically a trend following mechanism and has never been tested in a seminal bear market (algo trading accounted for a mere 10% of volume in the early 2000's and not much more during the GFC bear), what will happen if algo starts following a hypothetical down trend?
How long will it take algo masters to throw the "off" switch during a sudden market break? And will they then merely follow the bear all the way down, algorithmically speaking?
