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MiFID II algorithmic trading rules (Article 17 and RTS 6)

The most mature binding rules for AI in trading: MiFID II's algorithmic-trading regime requires testing, controls and kill switches, and ESMA has confirmed they apply to machine-learning strategies.

mifid iialgorithmic tradingesma

Required actions

  • Investment firms using algorithmic trading must have resilient systems, pre-trade controls, kill functionality and annual self-assessments - Test algorithms in non-live environments before deployment and keep records of parameters and changes - Notify the competent authority when engaging in algorithmic trading; ESMA guidance applies the rules to machine-learning strategies

Sources

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