In this chapter, we introduced algorithmic trading strategies and how ML has become a key ingredient for the design and combination of alpha factors, which in turn are the key drivers of portfolio performance. We covered various industry trends around algorithmic trading strategies, the emergence of alternative data, and the use of ML to exploit these new sources of informational advantages.
Furthermore, we introduced the algorithmic-trading-strategy design process, important types of alpha factors, and how we will use ML to design and execute our strategies. In the next two chapters, we will take a closer look at the oil that fuels any algorithmic trading strategy—the market, fundamental, and alternative data sources—using ML.
