Computerised automated trading begin as early as 1970s where stock market are converting to electronics trading from paper trading and it has growth tremendously. This makes trading effectively and manageable across a global market.
There are few strategies besides executing trades base on human inputs. The more common ones are trend following, hedging, channel trading, scalping, martingale, support and resistance trading.
Trend following – These are commonly used with averaging volume indicator like simple moving average, relative strength index and a combination of moving average using different timeframe or various average length. Common used are 9, 18 and 40 simple moving average, 20 and 80 relative strength index, etc
Hedging – This strategy is similar to hedge fund where trades are buy and sell to counter value the loss and profit. Common hedging are United State Dollar with Great Britain Pound, United State Dollar with Canadian Dollar, Swiss Franc with Australian Dollar, Euro with United States Dollar.
Channel trading – This trading watches the hourly or daily high and low and execute trades when reaches the low and high range. It will look like a bouncing ball where the price will go up and down bouncing like a ball.
Scalping strategy – This is more commonly used in Forex trading where small amount of profits or PIPS are taken from every trades and cumulative profit from many of these small trades. The risk is high but volume of trades will compensate its loss.
Martingale – This originates from mathematics arithmetic calculation where the lots quantity will increase with increasing losses. This is a sure win strategy in theory but in practical it is very difficult to achieve due to large capital that is required to maintain the margin.
Support and resistance trading – This is the fundament used in trading as it is believe trading price and traders will see support level and resistance level through out the whole duration of trading. The support and resistance can be divergence or convergence, thus makes many combination of support and resistance that can be obtained when looking at multiple timeframe.
MT4 and Tradestation are 2 main trading software widely used for Forex automated trading. Forex trading involved risk and you are to fully understand them before trading any of the commercial products.
Algorithmic trading and Direct Market Access (DMA) are important tools helping both buy and sell-side traders to achieve best execution.
This book starts from the ground up to provide detailed explanations of both these techniques:
- An introduction to the different types of execution is followed by a review of market microstructure theory. Throughout the book examples from empirical studies bridge the gap between the theory and practice of trading.
- Orders are the fundamental building blocks for any strategy. Market, limit, stop, hidden, iceberg, peg, routed and immediate-or-cancel orders are all described with illustrated examples.
- Trading algorithms are explained and compared using charts to show potential trading patterns. TWAP, VWAP, Percent of Volume, Minimal Impact, Implementation Shortfall, Adaptive Shortfall, Market On Close and Pairs trading algorithms are all covered, together with common variations.
- Transaction costs can have a significant effect on investment returns. An in-depth example shows how these may be broken down into constituents such as market impact, timing risk, spread and opportunity cost and other fees.
- Coverage includes all the major asset classes, from equities to fixed income, foreign exchange and derivatives. Detailed overviews for each of the world's major markets are provided in the appendices.
- Order placement and execution tactics are covered in more detail, as well as potential enhancements (such as short-term forecasts), for those interested in the specifics of implementing these strategies.
- Cutting edge applications such as portfolio and multi-asset trading are also considered, as are handling news and data mining/artificial intelligence.
There is also a website for this book at www.algo-dma.com
Algorithmic Trading and DMA: An introduction to direct access trading strategies.
Finally, the first comprehensive guide to MQL programming is here! Expert Advisor Programming guides you through the process of developing robust automated forex trading systems for the popular MetaTrader 4 platform. In this book, the author draws on several years of experience coding hundreds of expert advisors for retail traders worldwide. You'll learn how to program these common trading tasks, and much more: - Place market, stop and limit orders. - Accurately calculate stop loss and take profit prices. - Calculate lot size based on risk. - Add flexible trailing stops to your orders. - Count, modify and close multiple orders at once. - Verify trading conditions using indicators and price data. - Create flexible and reusable source code functions. - Add advanced features such as timers, email alerts and Martingale lot sizing. - Avoid common trading errors and easily troubleshoot your programs. - Adjustments for fractional pip brokers and FIFO. - Plus, learn how to create your own custom indicators and scripts! Whether you're a beginner or an experienced programmer, Expert Advisor Programming can help you realize your automated trading ideas in the shortest amount of time. This book features dozens of code examples with detailed explanations, fully-functioning example programs, and reusable functions that you can use in your own expert advisors!
Expert Advisor Programming: Creating Automated Trading Systems in MQL for MetaTrader 4. Click here to see 19 customer reviews and choose from 14 suppliers
As head FX strategist at CMC Markets–one of the world's leading forex/commodity brokers–Ashraf Laidi understands the forces shaping today's currency market and their interplay with interest rates, equities, and commodities. And now, with Currency Trading and Intermarket Analysis, he shares his extensive experiences in this field with you. Throughout the book, Laidi outlines the tools needed to understand the macroeconomic and financial nuances of this dynamic field and provides you with insights that are essential to making the most of your time within it.
Currency Trading and Intermarket Analysis: How to Profit from the Shifting Currents in Global Markets (Wiley Trading) Click here to see 18 customer reviews and choose from 30 suppliers