Pakistan, May 31 -- The Securities and Exchange Commission of Pakistan (SECP) has unveiled a new Concept Paper titled "Regulating Algorithmic Trading in Pakistan", marking a significant step towards fostering innovation in financial markets while ensuring investor protection and market integrity. This initiative comes as algorithmic trading gains global prominence for its ability to increase speed and efficiency in trading activities.

The SECP's framework acknowledges that despite the many advantages of algorithmic trading, such as enhanced liquidity and reduced transaction costs, it also introduces novel challenges including market manipulation risks, technological glitches, and systemic vulnerabilities. To mitigate these risks, the pro...