Algorithmic trading is the use of automated systems and algorithms to execute financial market trades based on predefined criteria, such as price, volume, and timing. This approach leverages mathematical models and complex computations to make rapid and accurate trading decisions, allowing traders to capitalize on market opportunities that may be too quick for human execution. Algorithmic trading can enhance market efficiency, reduce transaction costs, and manage risks, but it also requires sophisticated technology and an understanding of both the market mechanisms and the algorithms employed.