- Algo-trading reduces the risk of manual errors when placing trades.
- Trades are timed correctly and instantly to avoid significant price changes.
- Although Algorithmic trading is expensive, it reduces transaction costs.
Algorithmic is a third-party trading system developed and specialized in automated trading systems with strategies and quantitative trading analysis. Contrary to other trading systems, Algorithmic trading focuses on technical analysis rather than fundamental analysis.
The strategies are offered in five different trading algorithms and apply to both retail traders and professional investors. They include the Day Trader, the Swing Trader, the Wave Trader, the S&P Crusher, and the Professional Trader Suite. However, the Day Trader and the Swing Trader are the most popular.
The Day Trader
This places day trades on the S&P E-mini’s. An E-mini is an electronically traded futures contract that is a fraction of the value of a corresponding standard futures contract. It is predominantly traded on the Chicago Mercantile Exchange (CME) and available on a wide range of indexes. They range from NASDAQ 100, S&P 500, S&P MidCap 400, and Russell 2000. Commodities, such as gold, and currencies, such as the euro are also included.
The 100% algorithmic trading system trades the three-day trading algorithms (Gap Fill, Breakout and Breakdown). All traders are exited before the market closes. In addition to that, it trades in both the bull and bear markets.
The Swing Trader
This particular strategy trades two Algorithms (S&P 500 Momentum and Ten-Year Note). It has been trading live since its inception on October 2015. It boasts of fully automated trade execution through multiple National Futures Association (NFA) registered brokers. The Algo attempts to generate profit in up and down moving markets.
As the market is going higher trades are placed. Once a buy order is placed, Limit and Stop are issued. On the other hand, as the market sells off S&P Algorithms place fewer trades, and the ten-year note Algorithm takes over. Moreover, it takes advantage of the down moving S&P markets.
The Day and Swing Trader Online Reviews
The swing trader has had a positive online reputation for delivering hedge fund quality Algorithmic Trading Systems as per reviews on the table below:
Automated Trading of Cryptocurrencies- The use of Algorithms helps a lot in Crypto price predictions because of the fragmented and immature market and its high volatility. There is a lot of typical issues such as exchange overload messages, which makes one wait and sometimes made to try a little later.
In order to solve the problem of a falling market, the following automated trading techniques are used:
Technical Indicators – Help in the identification of trends allowing traders to make a profit in the long run.
Arbitrage Trading – This is carried out by taking advantage of a price difference between the two exchanges. The trader buys at a lower price on one exchange and sells at a higher price on another exchange. Arbitrage Trading is possible because of the large number of exchanges. Besides, at times there is a huge variation in the prices
Market Making – The market maker places continuous buy and sells orders around different prices, hoping that people will buy from him and sell back to him. He finally makes small profits; however, the technique is not known by many traders.
Advantages of Algorithmic Trading in Cryptocurrency
Algorithmic Trading utilizes a computer-defined set of instructions which places a trade and generate profits at a higher speed and frequency impossible for a human trader.
Although Algo-trading is a superb system, it is quite expensive. It retails at a minimum of $17,000. Nonetheless, yearly maintenance fees are required to keep it in its optimum state.
In conclusion, Algorithmic Trading has a lot to offer to both swing and day traders. Accuracy in placing of trades and exiting positions is key for making impressive profits. Above all, traders have the ability to avoid significant price changes.