Community

Share knowledge. Find answers. Ask questions.

Online Share Trading

Engage and learn about markets and trading online

Automated Algorithm Trading

Reply
Frequent Contributor
The human brain cannot think faster than a computer. If you have an artificial intelligence package which does data analysis for you, you can very quickly find trading opportunities. One cannot analyse all 800 or so companies on the JSE in one's head. A trader trades price action regardless of sector. Secondly one uses maths, like moving averages, stochastics etc to determine entry and exit points. So Werner is correct, it's all about maths.
0 Kudos
Super Contributor
If you believe that it's ALL about maths, then you are doomed as a trader.....
0 Kudos
Frequent Contributor
Rams, so what do traders use to determine entry and exit points? Intuition (no), fundamental (no), osillators (yes!!). Then one looks at any news and bang you are in business. Enough said from me, I'm going for a swim
0 Kudos
Super Contributor
RAMS, what's it all about then?
0 Kudos
Super Contributor
DISCIPLINE..... When Simon first posted it here, I also resisted it, until I started I trading the ALSI 15 minutes.
0 Kudos
Super Contributor
OK, so if people employ DICIPLINE, they dont need anything like technical indicators of any sort, DICIPLINE alone will make them profitable?
0 Kudos
Super Contributor
0 Kudos
Valued Contributor
discipline and price .. yip that enough, if you wanna get technical toss in a moving average or three ..
0 Kudos
Super Contributor
Ok, cool. but that now will involve some mathematics, right?
0 Kudos
Super Contributor
This is the most stupid argument ever... I think we can conclude that mathematics is important to some degree, discipline is important too, obviously... but even if you only require discipline and price, what are you going to do with that singular value, possibly compare it to something else, like another price from 15 minutes or 1 hour or 1 day ago? so you will be doing mathematics.. this started off by saying that maths isnt important but it turns out that this process will not be possible without maths? true or not?
0 Kudos
Super Contributor
So, a totally automated system that uses whatever logic you use in your trading would add an incredible amount of discipline together with your logic... this should work, provided the logic works flawlessly, which is normally the problem. then even with discipline it will fail if its not correct or sustainable? or am i now missing the point?
0 Kudos
Valued Contributor
well moving average is maths, low level but maths yes .. but otherwise no, price is just price
0 Kudos
Super Contributor
yes, but what do you do with the price? compare it to something perhaps? I think that might involve maths. bottom line, maths is involved and if you have a good system where maths is involved you can make money using it in an automated trading system.
0 Kudos
Valued Contributor
fair point, even if just gap or momentum systems (price only) there is maths .. bottom line any mechanical trading system should be able to be programmed so it can just trade
0 Kudos
Super Contributor
You forget something , the system can never be 100 %....and it has to be fed,,,,,you have to put in money for it to function.....will you have the discipline to feed it when , it is in the 30% losing cycle .....yes that's what you been missing
0 Kudos
Super Contributor
If its totally automated, it would get fed from the start and would handle stoplosses and money management, otherwise its not a totally automated algorithm trading system. And of course one will back test and back test and if you are happy, why not stick to your disciplines in a decline? do you do that with your current trading system? how disciplined are you?
0 Kudos
Frequent Contributor
Have you looked at quantitive analysis? There are some Unit trusts called Quant funds which uses this type of analysis There are packages that do daily recommendations according to certain strategies - would you like to automate the trading part as well?
0 Kudos
Super Contributor
my view would be that everything needs to run 100% by itself, analysis, trading, selling, money management... if this could be built it would make a great project!
0 Kudos
Super Contributor
@RAM..not sure if you are aware of this fact, Werner is a programmer and he does this for a living.
0 Kudos
Super Contributor
Werner , you still missing something...the money has to come form somewhere for the system to function...like fuel that makes the car go...
0 Kudos