Brokers who facilitate mechanical trading

JTrader

Guest
5,741 506
Facilitators of mechanical Forex trading

Hello

I thought it would be helpful to draw up a list of Forex dealers/brokers who facilitate mechanical trading in one form or another, either through an API or another method such as CMS forex's 'indicator builder.'

I am aware of www.interactivebrokers.com, www.oanda.com, www.cms-forex.com
and www.gftforex.com.

Are there any others out there, and what do they offer the trader?

Thanks.
 
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BBB

Experienced member
1,071 3
Jtrader - Try Refco. They have a partnership with e-signal. You can automate the system on e-signal and it will autoroute the order to your account I believe.
 

JTrader

Guest
5,741 506
Thanks BBB

I thought esignal had such a thing, but when I asked them they said they didn't! (?)
 

BBB

Experienced member
1,071 3
I think you've got to approach Refco rather than e-signal. Doesn't give you much confidence though does it!!??
 

JTrader

Guest
5,741 506
Sorry to change the direction a little, but I'd like to broaden this discussion :idea:

As a forward thinking, technology embracing day trader, I await big developments and improvements in the reliability and provision/facilitation of mechanical trading over the next few years. :D

I think that the potential benefits of mechanical trading are huge, in that the process removes subjective judgement/trader pyschology, emotions and inhibitions from the trading process.

Although it will still probably be sensible and necessary to sit and watch the market and ensure that triggers are executed correctly, I anticipate that mechanical trading systems will make the job of a trader much easier and enable greater financial success.

Do you share my vision :?:

Do you agree that mechanically implementing a trading strategy that has been successfully traded manually, is likely to lead to better results than manually trading the same trading strategy:?:

Or, would you prefer to trade manually, and expect to attain better results by doing so :?:


cheers

jtrader.
 
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JonnyT

Senior member
2,560 22
TradeStation already does this!

Hi jtrader,

You can get literally thousands of mechaical systems that work reliably on TradeStation today. Thats not to say they actually do work.

Additionally there are two brokerages in the States that trade Mechanical systems for you. One is www.striker.com

To get a subjective view of what has stood the test of time it's worth looking at www.futurestruth.com

Most traders fail because of there 'head', I firmly believe this is why mechanical trading offers some advantages: You don't get panicked out of the trade, you trade consistentanly in a repeatable manner.

Balanced with that a good day trader will do better than any mechanical trader but may also burn out quicker.

JonnyT
 
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JTrader

Guest
5,741 506
Thanks JT

I have been doing some research into tradestation and it does appear to be very good. Would I be right in thinking that it is the favourite platform of it's kind on the market?

How reliable is it in terms of executing trading strategies mechanically ? is their still room for improvement?

Cheers.
 

JonnyT

Senior member
2,560 22
There is always the chance that:

1) You lose your Internet connection
2) Your broker loses its systems
3) Your broker loses connectivity
4) The exchange you are trading crashes
5) The exchange you are trading loses connectivity
6) Your PC crashes
7) Your trading application crashes

These event happen every year and probably always will do.

There are several things you can do to reduce these risks:

1) Have a UPS
2) Dedicate a PC to trading and trading only
3) Have a back up internet connection
4) Have a backup broker
5) Have a alternative way to hedge if appropriate
6) Ensure you PC is critical updated
7) Use a Commerical Anti-Virus application with auto update
8) Use Linnux (you can with Spot On)

JonnyT
 

kevin546

Established member
699 0
Having the ability to trade a mechanical system that actually does your trading for you while it is everyone's dream I would have thought the market would work hard to ensure it did not work.

If it was a success everyone would want a piece of the action, if everyone started to trade from the same pitch would it not have a detrimental affect. I thought the reason the market works is that there must always be someone on the other end of the deal. If you had a confirmed mechanical system that was left to get on with it then as more joined this style the edge it once offered maybe reduced. However in the early stages it would be a winner, if confirmed. Just my thoughts on the matter.

Kevin
 

BBB

Experienced member
1,071 3
Some good points. Although I dont disagree with any of it though, I dont think it would work with my way of trading.

As we all know, the markets keep changing their character. A mechanical system to me suggests you are trading the same set up with the same trade management day in day out - correct me if I am wrong.

An intuitive manual trader may wish how and when he enters and exits a position according to how the market is behaving. I think it would be very difficult to code that intuition into Tradestaion, metastock etc.

I may have a number of set ups that I look for. If I took 100% of these setups (as a mechanical system would - if it could define them) my edge would be around 60%. If I trade these with discretion, applying filters to decide if I take the trade or not, my edge can increase to 65-70%.

IMO if you decide to eliminate the learning curve required to install discipline and the selectivity in your trading by trading a mechanical system, you are giving up an edge, which over time can mean a great deal of money. The upside is that you may achieve profitability quicker. BUT you may still have the learning curve of how to program a computer - something I decided I couldn't stand after studying software engineering for 4 years at Uni!

Its a trade off.
 

JTrader

Guest
5,741 506
Charting packages that facilitate the design and implementation of mechanical trading

Hello

I am interested in auto trading forex via a TA based mechanical trading system. At present tradestation do not facilitate forex automation - however, according to their website it's coming soon.

The next best thing would be to use my mechanical trading strategy and manually place trades triggered by the chart. This I could do with tradestation - and this would probably be the best idea - as I can keep my broker and mechanical charting application, and automation when it does become available for forex - under the one tradestation umbrella. ;)

However, i would like to know if there are any other charting packages available that enable the design, implementation (and if possible, backtesting) of mechanical trading strategies - which will will include around 15 conditions. I have 4 mechanical systems that I would alternate between and therefore thepackage would need to be able to hold all 4 (which shouldn't be a problem :!: )

Finally, tradestations forex brokers/dealers are R.J. O'Brien Foreign Exchange. If anybody is aware, how good are these brokerage services (both spot & futures) in comparison with the likes of FXCM, AC Markets, CMS forex & GFT forex & IB in terms of maintaining their 3 pip spreads (on spot), order execution speed, slippage, requotes etc?

Many thanks

jtrader
 
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