What Is Discrete trading?

In discrete trading, a trading strategy shifts between positions in discrete, usually large and complete, steps.

Here are the key characteristics of discrete trading:

• Scheduled execution: Trades are made at specific, predetermined times rather than continuously throughout the trading day.

• Less frequent: Trading occurs at intervals, which could be daily, weekly, monthly, or even quarterly.

• Manual intervention: Often involves more human decision-making and less reliance on automated systems.

• Batch processing: Orders are often grouped and executed together at set times.

• Traditional portfolio management: More commonly associated with traditional buy-and-hold strategies or periodic rebalancing approaches.

Discrete trading is the opposite of continuous trading.

Discrete algorithmic trading usually uses technical indicators thresholds to enter and exit positions fully.

See also:

• Continuous trading

• Trading Strategy

• Technical indicator-based strategies