BeAlgo Presents: Best Practices for Successful Algo Trading in 2018

Share Article

BeAlgo, a global broker specializing in algorithm trading technology published its top three best practices for successful algo trading in 2018, taking into account the fast-paced nature of global stock market transactions: ● High speed of operation ● Real-time, fast-paced analysis ● Quality back testing

1. High speed of operation

When it comes to algorithmic trading, one of the most important parameters is speed of operation, in light of the rapid rate of transaction enabled by electronic trading sites. When an algo-trading program identifies a transaction opportunity, it immediately sends it out to the market and since in the dynamic stock market, the monetary value of a financial asset is in a continuous state of fluctuation, even the slightest delay of action can lead to a buy or sale at a drastically different price from the one the program was meant to close on.

As such, a high speed of operation is of tremendous importance. That’s why the BeAlgo platform’s speed of operation is optimized to complete a transaction within 0.001 seconds, significantly faster than the global average of 0.05 seconds. This enables us to provide algo trading companies with faster, better and more lucrative transaction results for their clients. In return, we are able to receive great BeAlgo Reviews from each of our merchants.

2. Real-time, fast-paced analysis

The ability to analyze trades quickly and in real-time significantly influences the speed in which a transaction successfully takes place. Algorithms that have been in operation for a minimum of three years and have been active throughout stock market fluctuations, are able to generate great profits from the world’s leading indices, including S&P and DOW JONES, with a low drawdown, due to the data they have collected and the analyses they have run. The BeAlgo platform harnesses all available algo trading data to create an optimal trading environment based on real-time information.

3. Quality backtesting

To successfully determine which types of assets are the smartest, most profitable investment opportunities, algorithm’s decisions must be routinely backtested. And while BeAlgo’s team of algo trading experts must emphasize that algorithms that profit during backtesting do not necessarily profit during actual trades due to a wide variety of reasons and factors including a lack of liquidity and slippage challenges, backtesting does allow for the identification and elimination of 99% of program “tics.” When applied over time, quality backtesting allows for the examination of whether algorithms successfully meet changing market standards, for optimized operations.

BeAlgo routinely engages in quality backtesting, including testing out its algorithm on a demo account under real market conditions, to determine how to best generate profits, even when the market experiences fluctuations.

“At BeAlgo, we believe that profit margins are not important. What is important is the bottom line. For example, there are algorithms that generate profits of 90 percent of the deals it enacts, but at the end of the day, money is lost in the short-term. For example, a profit of 10 euros at a 90 percent success rate means that 9 deals out of ten will bring in revenues, for an overall profit of 90 euros. Yet, that tenth deal will bring with it a loss of 100 euros, so even though the profit rate is high, the trader lost money,” said BeAlgo’s Research and Development Department.

“In the same vein, there can be an algorithm that works according to low success rates, below 50 percent, but its bottom line will be extremely lucrative. A successful trading algorithm must generate profits throughout the years and under any market condition, regardless of deals’ success rates,” Bealgo’s Research and Development Department adds.

“To sum, if the backtesting, at a modelling rate of 99 percent and low drawdown rate, is profitable throughout market fluctuations, then the algorithm is ready for testing on a demo account, using demo fuds with real market fluctuation. If successful, the program can then be transferred for use in actual market transactions. It is extremely important to work together with capital market and programming experts, knowledgeable and experienced in locating program weaknesses and making necessary modifications. If the broker provides an appropriate platform with high liquidity, there is a great chance for trading success in the real market,” Bealgo’s Research and Development Department concludes.

About BeAlgo

BeAlgo is a global brokerage company that develops technology that harnesses the power of modern innovation into the most precise, accurate and lucrative trading tool on the market. BeAlgo leverages comprehensive capabilities of the latest computing systems to give traders accurate, real-time data, speed of operation and quality tested algorithms for that extra competitive edge. By placing their confidence in Algo Trading / Automated Trading, the company’s clients can be well assured that they have opened the doors to the most optimal environment for expanding their business.

For more information, visit http://www.bealgo.com.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

BeAlgo
BeAlgo
+61 391112332
Email >
@Be_Algo
since: 08/2017
Follow >
Follow us on
Visit website