# What is agentic trading?

Agentic trading is an AI agent with tools for market data, account reads, and orders through an official [broker connection or API](/guides/broker-ai-connectors). It researches, proposes, or places trades inside limits you set. You own the account, rules, limits, and the [kill switch](/guides/ai-trading-bot-kill-switch). The [survey](https://arxiv.org/html/2605.19337) calls the loop perception, memory, reasoning, and action. [FMSB](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf) says market-facing AI stays under human supervision.

Checked 2026-10-19.

## Trading bot, AI trading agent, and robo-adviser

A trading bot, on this page, means the [survey's](https://arxiv.org/html/2605.19337) rule-based controller. It runs if-then rules and does not take an LLM reasoning step. The same section also names lightweight neural networks and pre-compiled decision tables in that reactive group. An AI trading agent means the survey's loop of perception, memory, reasoning, and action. The survey says tool use in financial agents needs its own evaluation. A [robo-adviser](https://www.investor.gov/introduction-investing/investing-basics/glossary/robo-adviser) is an automated advisory program that collects goals, time horizon, income, other assets, and risk tolerance on a questionnaire, then creates and manages a portfolio.

| Kind | What runs the next step | Source |
| --- | --- | --- |
| Trading bot | If-then rules, with no LLM reasoning step. | [Survey, reactive reasoning](https://arxiv.org/html/2605.19337) |
| AI trading agent | Perception, memory, reasoning, and action. Tool use needs its own evaluation. | [Survey](https://arxiv.org/html/2605.19337) |
| Robo-adviser | A questionnaire, then a portfolio the program manages. | [Investor.gov](https://www.investor.gov/introduction-investing/investing-basics/glossary/robo-adviser) |

## Research, propose, paper, then live

The [Agentic Trading skill](/skills/agentic-trading) defines four stages. A seat moves up only when you say so.

1. Research. The agent gathers and checks information. It drafts no order.
2. Propose. The agent writes a plan. You place the order.
3. Paper execution. The agent sends only in a paper or simulated account. The [paper-to-live gate](/skills/paper-live-gate) stays disarmed until you arm it.
4. Live with hard limits. The [kill switch guide](/guides/ai-trading-bot-kill-switch) defines the switch as a control the agent can read and cannot write.

## Risks and controls

No. [The SEC, NASAA, and FINRA](https://www.finra.org/investors/insights/artificial-intelligence-and-investment-fraud) say AI-generated information can be faulty or made up, and it can rest on outdated data. [FMSB](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf) says the market-facing systems it studied do not run with full autonomy and stay under human supervision. Automated trading can lose money; start on paper and set hard limits.

[The SEC, NASAA, and FINRA](https://www.finra.org/investors/insights/artificial-intelligence-and-investment-fraud) published that article on January 25, 2024. [FMSB's](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf) February 2026 review says human coders, traders, and managers stay accountable for a machine's actions. It also says many risks are already handled by controls such as real-time algorithmic trading controls.

Paste one order into [Agent Order Check](/check). The check runs in your browser. The order stays on this page and is not sent. Official connectors, and whether each can order, are on [broker connectors](/guides/broker-ai-connectors). This page names no broker.

## Is agentic trading the same as algorithmic trading?

No. [FINRA](https://www.finra.org/rules-guidance/key-topics/algorithmic-trading) says a member firm that runs an algorithmic strategy is subject to supervision rules, and that testing the strategy before production is an essential part of effective procedures. The [survey](https://arxiv.org/html/2605.19337) separates rule-based controllers, which skip an LLM reasoning step, from agents that perceive, remember, reason, and act.

[FINRA's algorithmic trading page](https://www.finra.org/rules-guidance/key-topics/algorithmic-trading) says member firms that engage in algorithmic strategies are subject to SEC and FINRA rules, including FINRA Rule 3110 (Supervision). It says testing a strategy before production is an essential component of effective procedures, and that firms should review trading activity after a strategy is in place or has been changed.

The [survey](https://arxiv.org/html/2605.19337) characterizes an agentic trader by perception, memory, reasoning, and action. In the reactive section it says rule-based systems encode if-then rules and execute them once the conditions are met, and that this reactive pattern does not use an LLM reasoning step.

## Can an AI agent place trades in my brokerage account?

Only when an order tool is connected and you have allowed that action. The [broker connectors page](/guides/broker-ai-connectors) lists official connectors and whether each one can send an order. [FINRA](https://www.finra.org/investors/insights/auto-trading-unregistered-entities) says giving an unregistered service your brokerage username and password creates privacy and financial safety risks. You keep the [kill switch](/guides/ai-trading-bot-kill-switch).

The [broker connectors](/guides/broker-ai-connectors) page is the list of official connectors checked for this site, including whether a row can send an order. Do not treat a missing row as a yes. [FINRA's auto-trading note](https://www.finra.org/investors/insights/auto-trading-unregistered-entities), July 29, 2025, says giving an unregistered service the username and password to your brokerage account poses serious privacy and financial safety concerns.

## Is agentic trading safe?

No. [The SEC, NASAA, and FINRA](https://www.finra.org/investors/insights/artificial-intelligence-and-investment-fraud) say AI-generated information can be faulty or made up, and it can rest on outdated data. [FMSB](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf) says the market-facing systems it studied do not run with full autonomy and stay under human supervision. Automated trading can lose money; start on paper and set hard limits.

The joint article says AI-generated information can rest on inaccurate, incomplete, misleading, or outdated input, and that the resulting information can be faulty or made up even when the input was accurate. [FMSB](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf) says those market-facing systems stay under human supervision and intervention, and that none of them has full autonomy.

## How do I start with agentic trading?

Start at research, with no orders. Paste the prompt below. It asks for sourced observations and tells the agent to stop. The four-stage ladder is the [Agentic Trading skill](/skills/agentic-trading). Paper stays paper until you arm live on the [paper-to-live gate](/skills/paper-live-gate). Automated trading can lose money; start on paper and set hard limits.

### Paste this into the agent

```
Stage: research. No orders and no trade plans.
My universe: [name the symbols]. Time window: the last 7 days.
Return up to 5 observations: Asset | What changed | Source link | Date.
Mark anything you did not open UNVERIFIED.
Stop. Do not draft an order.
```

### Stop and ask

- A max-loss number. This page does not pick one. You write it.
- A broker that is not on the connectors page. Stop. This page does not add one.
- A paper log treated as a forecast of a live result. The [paper-to-live gate](/skills/paper-live-gate) says a paper log is not a forecast of a live result.

## Sources

Checked 2026-10-19.

- [Agentic Trading: When LLM Agents Meet Financial Markets](https://arxiv.org/html/2605.19337), HTML
- [FMSB, AI in Trading, Spotlight Review](https://fmsb.com/wp-content/uploads/2026/02/FMSB-AI-in-Trading_Final_12.02.26_FINAL.pdf), February 2026
- [FINRA, Algorithmic Trading](https://www.finra.org/rules-guidance/key-topics/algorithmic-trading)
- [SEC, NASAA, and FINRA, Artificial Intelligence (AI) and Investment Fraud](https://www.finra.org/investors/insights/artificial-intelligence-and-investment-fraud), January 25, 2024
- [FINRA, auto-trading services from unregistered entities](https://www.finra.org/investors/insights/auto-trading-unregistered-entities), July 29, 2025
- [Investor.gov, Robo-Adviser](https://www.investor.gov/introduction-investing/investing-basics/glossary/robo-adviser)
- [Agentic Trading skill](/skills/agentic-trading)
- [Paper-to-live gate](/skills/paper-live-gate)
- [Agent Order Check](/check)
- [Kill switch](/guides/ai-trading-bot-kill-switch)
- [Broker connectors](/guides/broker-ai-connectors)

Educational only. Not financial advice.

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