How to market trading strategies?

[Girija]

I got this:
1) A software to research, develop and test option trading strategies on historical market data, then run them on live data by using Interactive Brokers API.
2) Several strategies developed using this software, latest of which I previewed in the thread labeled "How do these equity curves look in the eyes of a trader?".

Now I'm starting the next step: marketing. Way out of my comfort zone but no way around it if I'm gonna make money out of this.

The marketing campaign will target the following segments, in order of preference and only move to a latter if I fail in sustained efforts to make a successful sell to the former:
1) Professional finance: hedge funds, investment banks, pension funds.
2) Retail traders willing to pay for proprietary trading strategies.
3) Open source and give all for free.

Making a sale means giving up all the proprietary knowledge involved in running the strategy presented here: fundamental basis on why it's profitable and how it works up to complete algorithmic implementation. No black box, full disclosure. So if a #1 entity chooses to run it, it's a strong validation of the value of my research and a moral compensation (apart from the many $$$) for the many years of effort I've put into this.

Anyways, it's not gonna be a walk in the park and this is the point where I need an associate if not for something else, to avoid getting ripped off. ( Hopefully not by the associate itself )

It's a bit thick-skinned to ask free advice on this, but nevertheless: any ideas on how to formulate a compelling advert to be sent by mail? I intend to spam a hell lot of #1 in order to get a foothold with someone in a position to deploy a trading strategy to serious capital. The top-down approach, not the usual rectal examination you get in a bottom-up "get hired" by recruiters approach.

I used to work at one of the #1s. I had pretty much zero knowledge in trading systems but picked up on the job. My team wd convert what super traders want to do into efficient algorithms. Then there are front end developers who don't know what backend does.They home brew a lot. Some proprietary code in hft side exists but those are pretty expensive and very specialized, requires consulting but the point is their software budget runs into several millions moving multi billions.. If you say you have the same code targeting #1 and retail traders then it does look like a red flag (no offense to you). What is affordable to #1 will be unaffordable to retail and #1 don't buy cheap sw.
You can penetrate small hedge funds if you prove that you provide them an edge. They mostly like automated code that can highlight options. Stock strategies have limited scope. Pick out a list and ask for an audience or demo using live feed. They won't buy into backtest crap. If the sw makes them go belly up on the get go, they will be after you.
In covid mkt anyone can claim an algo. Are you sure.

 

[mukoh]

Aquarians,

You have a strategy that does 13% sim trading, and you think it's gold mine that hedge funds that spend $100m+ each a year for just salaries for their developers, data experts would want?

 

[Aquarians]

Separate the tool from trading strategies, then sell the tool (showing it to everyone).
There are several option strategies testing tools out there and they have nothing to hide, so if you can create a competing product then you can try selling it to everyone, even to traders on ET
Once you have customers, then later you can also offer trading strategies to them.

Yes, this is an alternate approach, though I might start with at least a free if not fully open source tool. I'd start with:
- Display and validate market data. So you can browse through years of data, step through day by day, select a term and view the vol curve and options. Data validation is very important because the one I pay for has a lot of errors, and I suspect any cheap feed will have the same problem.

Also I might be willing to open source this part since if someone steps in and helps with data validation code (essentialy algos + heuristics) so I can reliably filter out crap, it's useful for me too.

 

[Aquarians]

I used to work at one of the #1s. [...]
If you say you have the same code targeting #1 and retail traders then it does look like a red flag (no offense to you).

It needs at least a few $100,000s to work. I can (and will) only test it on a virtual trading account, just to confirm I'm getting the same figures as in a simulation.

 

[Aquarians]

Aquarians,

You have a strategy that does 13% sim trading, and you think it's gold mine that hedge funds that spend $100m+ each a year for just salaries for their developers, data experts would want?

10% with a Sharpe of 2 is a dream for pension funds. I knew a guy who got financed ($5MM) on a much crappier system just because "it lost less when market went down" and "made same or more when it went up", or so it claimed.

Not all systems are supposed to work on a Robinhood $2000 account and take it into millions.

And not all systems require a "track record" on a retail trading account on trader's money, this is not how research in professional finance works.

 

[themickey]

Why not create a syndicate of ET members, they chip in $10k each which remains in their ownership. A little bit like a ET hedge fund.
If the kitty grows, great, if it declines then they may assist a little like open sourcing to fine tune.
If you name it 'Church of the Latter Day Shitheads' then possibly get tax exemption.

 

[Aquarians]

Why not create a syndicate of ET members, they chip in $10k each which remains in their ownership. A little bit like a ET hedge fund.
If the kitty grows, great, if it declines then they may assist a little like open sourcing to fine tune.
If you name it 'Church of the Latter Day Shitheads' then possibly get tax exemption.

Not the worst idea, especially the naming part

 

[fan27]

I got this:
1) A software to research, develop and test option trading strategies on historical market data, then run them on live data by using Interactive Brokers API.
2) Several strategies developed using this software, latest of which I previewed in the thread labeled "How do these equity curves look in the eyes of a trader?".

Now I'm starting the next step: marketing. Way out of my comfort zone but no way around it if I'm gonna make money out of this.

The marketing campaign will target the following segments, in order of preference and only move to a latter if I fail in sustained efforts to make a successful sell to the former:
1) Professional finance: hedge funds, investment banks, pension funds.
2) Retail traders willing to pay for proprietary trading strategies.
3) Open source and give all for free.

Making a sale means giving up all the proprietary knowledge involved in running the strategy presented here: fundamental basis on why it's profitable and how it works up to complete algorithmic implementation. No black box, full disclosure. So if a #1 entity chooses to run it, it's a strong validation of the value of my research and a moral compensation (apart from the many $$$) for the many years of effort I've put into this.

Anyways, it's not gonna be a walk in the park and this is the point where I need an associate if not for something else, to avoid getting ripped off. ( Hopefully not by the associate itself )

It's a bit thick-skinned to ask free advice on this, but nevertheless: any ideas on how to formulate a compelling advert to be sent by mail? I intend to spam a hell lot of #1 in order to get a foothold with someone in a position to deploy a trading strategy to serious capital. The top-down approach, not the usual rectal examination you get in a bottom-up "get hired" by recruiters approach.

Run it on SIM for a bit and if it performs well, I can get you in contact with one of the worlds largest algo hedge funds. They have a group that reaches out to independent traders (they found me on LinkedIn), evaluates what they are doing and if they like it, enter into some sort of agreement where they can use the strategy. In my case, I gave them read only access to my Interactive Brokers account. My strategies at the time eroded performance wise so no deal was struck. One option to track live performance is you can post trades to their system in real time. Of course the strategies need to be scalable and not be to tightly correlated to equity indexes.

 

[Aquarians]

Run it on SIM for a bit and if it performs well, I can get you in contact with one of the worlds largest algo hedge funds. They have a group that reaches out to independent traders (they found me on LinkedIn), evaluates what they are doing and if they like it, enter into some sort of agreement where they can use the strategy. In my case, I gave them read only access to my Interactive Brokers account. My strategies at the time eroded performance wise so no deal was struck. One option to track live performance is you can post trades to their system in real time. Of course the strategies need to be scalable and not be to tightly correlated to equity indexes.

Got it, thanks for the tip.

 

[traider]

Run it on SIM for a bit and if it performs well, I can get you in contact with one of the worlds largest algo hedge funds. They have a group that reaches out to independent traders (they found me on LinkedIn), evaluates what they are doing and if they like it, enter into some sort of agreement where they can use the strategy. In my case, I gave them read only access to my Interactive Brokers account. My strategies at the time eroded performance wise so no deal was struck. One option to track live performance is you can post trades to their system in real time. Of course the strategies need to be scalable and not be to tightly correlated to equity indexes.

What was the minimum sharpe ratio requirement?