Algorithmic trading : Is the logic used secret or should it be revealed to exchange?

The reason I asked this question is I read here http://zerodha.com/z-connect/charting-coding-and-backtesting/automation/automating-trades-getting-started that all strategies should be audited by CA, demo given to exchange etc. So wouldn't that lead to leaking of the strategy to others ? If a profit making strategy is out, others will also be implementing the same.

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Revealing the strategy to exchange is important to verify the critical conditions of the strategy. Mean, is there any loop in the conditions which may lead to market/price manipulation or systematic errors, once they verify & feel comfort of your strategy they will approve the same, in case any changes to be made will ask you to do the same. Again you need to resubmit the strategy to reverify the same.

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Yep, for now any strategy that you want to completely automate has to be taken to the exchanges to get an approval. Exchanges are highly regulated, and chances of your strategy leaking out is very small. But the risk definitely exists.

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