RT Journal Article SR Electronic T1 Be Wary of Black-Box Trading Algorithms JF The Journal of Investing FD Institutional Investor Journals SP 7 OP 15 DO 10.3905/joi.2019.1.090 VO 28 IS 5 A1 Smith, Gary YR 2019 UL http://joi.pm-research.com/content/28/5/7.abstract AB Black-box algorithms now account for nearly a third of all US stock trades. It is a mistake to think that these algorithms possess superhuman intelligence. In reality, computers do not have the common sense and wisdom that humans have accumulated by living. Trading algorithms are particularly dangerous because they are so efficient at discovering statistical patterns—but so utterly useless in judging whether the discovered patterns are meaningful.TOPICS: Quantitative methods, risk management