Stock Trading Robots: are they legal?

[eurojack]

Quote from tdev:

Still, this does not answer the question why there is an asymmetry between stock market and forex in terms of supply of automatic trading strategies.

Because stock trading is not accessible to everyone like fx spot. To trade stocks you need to have money (no leverage) and be serious about it if you don't want to lose all your money right away while with fx spot every kid on the block with literally 5$ in his pocket can trade currencies because of the leverage offered on the market (trading cents or even less) hence the popularity (community->tools).

 

[braincell]

Quote from eurojack:

Because stock trading is not accessible to everyone like fx spot. To trade stocks you need to have money (no leverage) and be serious about it if you don't want to lose all your money right away while with fx spot every kid on the block with literally 5$ in his pocket can trade currencies because of the leverage offered on the market (trading cents or even less) hence the popularity (community->tools).

What he said.

To put it even more simply, FX is open to newbies and it's easy to get an account. Newbies are the ones who think good robots are for sale, so they are the suckers to buy them most, and that's why there's a lot of FX robots you can see "for sale".

 

[sledgeyum]

Yes it is legal. Hft?


Tos has this now. Tda has it in strategy desk.

Ninja trader you can write your own programs.

Quote from tdev:

Hi there,

I can see a lot of offerings of Forex robots but cannot really find anything for stocks. Well, may be except for MARL

I wonder if selling stock trading robots is a legal business. My guess is that Forex is not regulated and hence it is possible to provide financial advice (i.e. robot), while for stocks it is not really possible due to regulations.

Could anyone shed a light on the topic?

Thanks.

 

[tdev]

Quote from sledgeyum:

Yes it is legal. Hft?

Proof may be?

Selling robots may be treated as a financial advice, which is illegal unless you have a license.

 

[WS_MJH]

Quote from Occam:

Sorry for not answering your question directly, but are you not aware that nearly all (if not 100%) of "forex robots" that are sold to the public are flat-out frauds? There is absolutely no incentive to sell a profitable automated system publicly -- it just doesn't make sense for the creator of such a system to do anything other than trade it themselves.

http://www.wired.com/threatlevel/2012/04/stock-picking-robot/

So, I'm guessing you think collective2 and the systems on there are also pretty much a fraud. It's seems unreal that a good system would be on there; it'd seem the edge will disappear once more and more people use such system.

 

[Givem2me]

Sorry for not answering your question directly, but are you not aware that nearly all (if not 100%) of "forex robots" that are sold to the public are flat-out frauds? There is absolutely no incentive to sell a profitable automated system publicly -- it just doesn't make sense for the creator of such a system to do anything other than trade it themselves.

http://www.wired.com/threatlevel/2012/04/stock-picking-robot/

This isn’t really true. What any of us traders need and even what a robot would need to successfully trade would be consistency and predictability. We look at a chart and have an idea what the stock will do because we have traded similar looking charts in the past. Now, let’s say you could get 1 million robots out there trading billions of dollars on a certain set of defined set-ups. This would have to increase the predictability of the market, wouldn’t it?

 

[JSOP]

Hi there,

I can see a lot of offerings of Forex robots but cannot really find anything for stocks. Well, may be except for MARL

I wonder if selling stock trading robots is a legal business. My guess is that Forex is not regulated and hence it is possible to provide financial advice (i.e. robot), while for stocks it is not really possible due to regulations.

Could anyone shed a light on the topic?

Thanks.

Why would it be illegal?