They do.
It's called Computational Finance.
Some may argue that it's Quantitative Trading, not Systematic Trading... That's just one reason Maestro calls ET traders Amish.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
How long before you were fully automated?
- Thread starter travis
- Start date
They do.
It's called Computational Finance.
Some may argue that it's Quantitative Trading, not Systematic Trading... That's just one reason Maestro calls ET traders Amish.
Quote from bespoke:
I believe writing the automation is the easiest step in the process of having an automated strategy. The hardest part is sitting in front of the screen for months or years watching the markets trying to find an edge. I don't believe that can be taught in school.
Risk management, analysis of trading statistics, and how to avoid the pitfalls of over optimization can all be read in just a few chapters in a lot of trading books and could probably be taught in half a semester.
I have no idea what Maestro is running and what level of mathematics it requires so I can't say what level of schooling you would need. But the strategies I run require no math, no indicators, and could be spotted by ANYONE who looks at the market long enough. When I first started trying to find strategies I made them so complex using anything and everything I learned in school that I thought made me smart. But instead all I had to do was watch the market and it was right there in front of my face.
Ok, I may have said too much....
Btw, I voted < 1 year
It's equal. Programs and the strategies are always side-to-side.
1. Strategies are limited by the programming you have done for your tester and the execution engine.
2. The program you have is basically the reflection of how you approach your development process.
You trade intuitively, and that's very much fine. Many opportunities in the market are counter-intuitive. (At least, counter-intuitive from my perseption.)
Quote from propseeker:
for model-centric low-frequency strats, sure, maybe, but for execution-centric strats it's nowhere near trivial... and at the end of the day, once you scale all those low-freq's... it all ends up being execution-centric.
I agree. I was mainly speaking in terms of the early stages of development for the strategies that most individual traders would use, especially here on ET.
I spend most of my time these days working on execution. The finishing touches.
I actually want to ask a few guys...
Why do you trade systematically to start off with?
I'm asking because I read too much sh*t in ET about people starting off because of personal reasons (like an excuse for some psychological thing...) and feel that it's the only way to trade for "them". Most just seem to approach it as another extension of discretionary trading...
Do people have a rational / logical understanding of the benefits of trading systematic and the underlying effort required to pay your bills as one?
Why do you trade systematically to start off with?
I'm asking because I read too much sh*t in ET about people starting off because of personal reasons (like an excuse for some psychological thing...) and feel that it's the only way to trade for "them". Most just seem to approach it as another extension of discretionary trading...
Do people have a rational / logical understanding of the benefits of trading systematic and the underlying effort required to pay your bills as one?
I am not that great a trader, but I can give you my sincere opinion.
The first reason that motivated me to try strategy trading (back testing systems on tradestation) was to find out what worked. Not "approximately", but with a set of univocal rules. Until then I had been writing pages of "dos" and "don'ts", but I could never follow such rules, because they often conflicted with one another, and I didn't really trust them.
But, years later, the first reason that motivated me to get started with automated trading (and it took me years before I could accomplish anything) was indeed a psychological one.
I cannot use stoplosses. I get really mad when I lose (I almost feel offended by the market), and so discretionary trading always brings my balance to zero. I'll make a majority of good trades, but sooner or later, I'll make a bad trade that I won't exit, and then I'll keep that position open for days and weeks until I'll lose everything. I really think I am completely unfit to do any discretionary trading at all. I am saying this after losing money for ten straight years trying to get anything out of it.
Then, once having gotten into automated trading, I have recognized its other advantages and I think that, even if I could make money with discretionary trading, I should never engage in it. The other benefits of trading systematic (as in the question asked above) I can think of right now are:
- no emotions in any sense: automated systems never get excited after a win, depressed after a loss, but are always objective and balanced
- constant alertness and focus: they never get tired
- constant estimate of a whole long list of factors: a human could never weigh all the factors he himself has, one at a time, integrated in the system
- preserving one's health: not having to stay in front of the computer all day preserves your health in many aspects
- ...
The first reason that motivated me to try strategy trading (back testing systems on tradestation) was to find out what worked. Not "approximately", but with a set of univocal rules. Until then I had been writing pages of "dos" and "don'ts", but I could never follow such rules, because they often conflicted with one another, and I didn't really trust them.
But, years later, the first reason that motivated me to get started with automated trading (and it took me years before I could accomplish anything) was indeed a psychological one.
I cannot use stoplosses. I get really mad when I lose (I almost feel offended by the market), and so discretionary trading always brings my balance to zero. I'll make a majority of good trades, but sooner or later, I'll make a bad trade that I won't exit, and then I'll keep that position open for days and weeks until I'll lose everything. I really think I am completely unfit to do any discretionary trading at all. I am saying this after losing money for ten straight years trying to get anything out of it.
Then, once having gotten into automated trading, I have recognized its other advantages and I think that, even if I could make money with discretionary trading, I should never engage in it. The other benefits of trading systematic (as in the question asked above) I can think of right now are:
- no emotions in any sense: automated systems never get excited after a win, depressed after a loss, but are always objective and balanced
- constant alertness and focus: they never get tired
- constant estimate of a whole long list of factors: a human could never weigh all the factors he himself has, one at a time, integrated in the system
- preserving one's health: not having to stay in front of the computer all day preserves your health in many aspects
- ...
Quote from travis:
I am not that great a trader, but I can give you my sincere opinion.
The first reason that motivated me to try strategy trading (backtesting systems on tradestation) was to find out what worked.
But the first reason that motivated me to get started with automated trading (and it took me years before I could accomplish anything) was a psychological one.
I cannot use stoplosses. I get really made when I lose (I feel almost offended by the market), and so discretionary trading always brings my balance to zero, because I'll make a majority of good trades, but sooner or later, I'll make a bad trade that I won't exit, and then I'll carry on the open position for days and weeks until I'll lose everything. I really think I am completely unable to do any discretionary trading at all.
Then, once I have gotten into automated trading, I recognize all its other advantages and I think that, even if I could make money with discretionary trading, I shouldn't never engage in it. The other major advantages I can think of right now are:
- no emotions in any sense: automated systems never get excited after a win, depressed after a loss, but are always objective and balanced
- constant alertness and focus: they never get tired
- constant estimate of a whole long list of factors: a human could never weigh all the factors he himself has, one at a time, integrated in the system
- preserving one's health: not having to stay in front of the computer all day preserves your health in many aspects
Right now, I can't think of other groups of factors. Also, maybe I didn't pick the right categories.
I agree with you but please do not underestimate the impact of computer glitches that make it so often appear that machines have emotions:
Incorrectly written software (software bug)
Incorrect instructions given by the operator (operator error) (this might also be considered a software bug)
Undetected invalid input data (this might also be considered a software bug)
Undetected communications errors
Computer viruses
Computer security cracking (sometimes erroneously called "hacking")
http://en.wikipedia.org/wiki/Glitch
Quote from ronblack:
I agree with you but please do not underestimate the impact of computer glitches that make it so often appear that machines have emotions:
Incorrectly written software (software bug)
Incorrect instructions given by the operator (operator error) (this might also be considered a software bug)
Undetected invalid input data (this might also be considered a software bug)
Undetected communications errors
Computer viruses
Computer security cracking (sometimes erroneously called "hacking")
http://en.wikipedia.org/wiki/Glitch
???
Which part of travis' post made you write this???
I ask why people system trade >>> He primarily mentions about personal preferences >>> ... >>> ... >>> You write about software testing (Unit... Integration... Regression)
???
Yeah, everyone is right. I forgot to add, among the "benefits of trading systematic", speed of execution and the ability to monitor multiple markets/timeframes. And also it is true what ron said, even though he seemed to go off topic, that automated systems also have problems (that discretionary trading doesn't have), namely bugs and similar.