HFT is mostly arbitrage, that's why they need the speed to reduce the risk. The rest of algo trading (and quant trading in general) tries to guess which way the market and individual securities will go based on market indicators and work over longer time horizons than HF traders work in. A simple example is that in low interest rate stocks will tend to outperform bonds, so the trade is to go long stocks and short bonds. Of course we expect that simple trades like this quickly be seen to be profitable and do more people do it and so the benefit of doing the trade versus just going long the market (beta) should eventually go down. So quants are always looking for other, more complicated trades as their current ones become less profitable.