Automated Currency Arbitrage

R

Radarcontact

HI,

I have an algorithm to find arbitrage opportunities in currencies. I've been running it for a few hours and have seen returns between 8-18%. I am curious about:

(1) what platforms we can perform these trades
(2) what are the associated fees of these trades
(3) any other pertinent information that could limit our returns. Like taxes.


attached is an example from Jan 24th, 11:12AM Mountain Time with a 14% potential return.

Starting with 100 in JPY
JPY to EUR at 0.008651 = 0.865130
EUR to JPY at 132.566354 = 114.687130


Starting with 100 in EUR
EUR to JPY at 132.566354 = 13256.635420
JPY to EUR at 0.008651 = 114.687130

Is this legit? Or are there holes I am not seeing?

My Background: I'm a talented programmer/Computer Scientist. I have zero trading experience. I do have capital to work with. Would love to speak with someone who has trading experience.
 

Attachments

  • Screen Shot 2022-01-24 at 11.11.21 AM.png
    Screen Shot 2022-01-24 at 11.11.21 AM.png
    136 KB · Views: 77
Last edited:
No, everything is fine.
You have found the holy grail.
You should start trading now.
Soon you'll be billionaire.
It's a matter of weeks.

Seriously...if you know zip about trading, maybe start with trading stocks.
 
Radarcontact said:
HI,

I have an algorithm to find arbitrage opportunities in currencies. I've been running it for a few hours and have seen returns between 8-18%. I am curious about:

(1) what platforms we can perform these trades
(2) what are the associated fees of these trades
(3) any other pertinent information that could limit our returns. Like taxes.


attached is an example from Jan 24th, 11:12AM Mountain Time with a 14% potential return.

Starting with 100 in JPY
JPY to EUR at 0.008651 = 0.865130
EUR to JPY at 132.566354 = 114.687130


Starting with 100 in EUR
EUR to JPY at 132.566354 = 13256.635420
JPY to EUR at 0.008651 = 114.687130

Is this legit? Or are there holes I am not seeing?

My Background: I'm a talented programmer/Computer Scientist. I have zero trading experience. I do have capital to work with. Would love to speak with someone who has trading experience.
More...

Where did you get this data from? It's clearly wrong.

GAT
 
Trade for a while manually with small sizes to learn basics, you will be severely handicapped until you have, or (like you suggest) do work for an actual trader.

Overused but accurate XKCD:

engineer_syllogism.png
 
Radarcontact said:
How do you know this? Where did you check this information?

Getting the data from priceonomics.com
More...
You couldn't arb 14% on a currency when you had to cross the Atlantic by Schooner.

Now (with information travelling a bit quicker), there are thousands of algos looking to arb basis points.
 
Radarcontact said:
HI,

I have an algorithm to find arbitrage opportunities in currencies. I've been running it for a few hours and have seen returns between 8-18%. I am curious about:

(1) what platforms we can perform these trades
(2) what are the associated fees of these trades
(3) any other pertinent information that could limit our returns. Like taxes.


attached is an example from Jan 24th, 11:12AM Mountain Time with a 14% potential return.

Starting with 100 in JPY
JPY to EUR at 0.008651 = 0.865130
EUR to JPY at 132.566354 = 114.687130


Starting with 100 in EUR
EUR to JPY at 132.566354 = 13256.635420
JPY to EUR at 0.008651 = 114.687130

Is this legit? Or are there holes I am not seeing?

My Background: I'm a talented programmer/Computer Scientist. I have zero trading experience. I do have capital to work with. Would love to speak with someone who has trading experience.
More...

I'm going to assume you are who you say you are, and aren't just trolling. I couldn't find any FX data on the website you mentioned which is a bit suspicous, and it's clearly just a load of marketing data mostly. Even the free prices you can get from google or yahoo, or a thousand other websites, will give you more accurate information.

An arbitrage might be that you can buy it at price A in one place, and sell it at price B in a different place. These sorts of arbs are available in crypto, although you might then struggle to withdraw your profits, get them stolen by the exchange, or end up having them wiped out by gas fees.

They are not available in FX. Although there are multiple trading venues for FX, any tiny differences will get quickly arbitraged out. They are will be of the order of 0.01% or less - not 14%. This is a game only the banks and the likes of Citadel can play; as a retail trader you have zero chance of making money from this.

There are also tiny fleeting opportunities for 3 leg FX arbitrage eg USDJPY, EURJPY, JPYEUR, but again only the banks can make profits from this as the spreads will completely remove the profits.

GAT
 
  • Like
Reactions: rb7
You must log in or register to reply here.
Back
Top