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Algorithmic trading -how to choose?


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Hello all, I hope you are having a great day

I am interested in algorithmic trading on the MT4 Platform (although I open to suggestions about other paltforms), I was wondering how to choose which algorithm to use?  I would like to trade Silver as it doesn't require as much of a margin as other higher priced commodities. Does anyone have any good experience  with a particular Algorithm trading Silver, or trading in general?

With the Expert Advisors, how can one tell whether they really are an expert, it seems anyone can write code and call it an EA? Are there any in depth stats to verify the quality of the algorithm, I saw some basic stats on the MT4 platform. I am aware of back testing , but another consideration is having to pay for an algo - what if it doesn't perform well in the backtesting? Is there any relationship between the cost of the algo versus it's quality? Some of them are as little as $30, some are are $300, others are $1200

I have also heard of the copy trade feature, how would one select which trader to copy from?

Another thing to note, I will probably initially do my trading at fairly low rate of say $1 per cent, so that any failures won't cost a lot, once more confident I will increase the rate.

I guess it is a bit overwhelming for me at this stage, there are hundreds of EA's , could someone give a new starter some pointers in the right direction?

Thanks in advance for any advice or help.

 

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  • 2 weeks later...

Hi IdeaMan,

 I give you the same advice I would give to a friend. Unless you know inside out the strategy the algorithm is executing don’t spend money on it. 

 What you can do is find a strategy you like, with clearly defined stop loss and take profit for each trade and then either code it by yourself or hire a developer to code it for you.

 If you are with IG you can do algo trading via MT4 or ProRealtime. MT4 coding language is C-like unless you have a developer background it might be too much to understand. ProRealtime instead use a Visual basic language easy to understand. You can also create algorithms using the visual interface with no coding. Have a look at https://www.prorealcode.com/forum/prorealtime-english-forum/ if you are interested in that.

 As far as for the quality of the algorithms you see in MT4 shop there is no way to know because they are compiled and you cannot reverse engineer the code and have a look under the hood yourself. Do not fall for these so called EAs that show massive returns. These “backtests” used as marketing are run on algos with no stops and do not take into consideration the spread costs or overnight founding.

 Copy trading can be two different things:

  1.  Your MT4 platform is connected to another MT4 and each trade is mirrored. You need to know the person and both have to do some configuration for this to work. If you go this way make sure they show you at least 1 year track record.
  2. You use a broker like eToro and you select from their platforms one or more traders to copy. The cool thing there is that you can actually see their performances and trades. Stats are backed by the broker itself so you know who you are assigning money to. You can also decide how much capital to assign to each trader you follow, kind of like creating a portfolio to diversify. https://www.etoro.com/copytrader/ 

All the best,
Alex

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On 13/09/2020 at 08:38, dmedin said:

Four years huh.  How long until you make back all the money you lost in four years 🤣

haha good point! It's been a long road but to be fair this was never where the bulk of my investments were, This was more of a hobby and beer money thing for me and a good way to learn thing and showcase my portfolio and talk about it to others. Anyway if you wanted to take a look this is where my algo dumps logs for trades. 

 

https://github.com/tg12/trading_algo_logs_info - This is a simple algo that looks at 3 day downtrends and SMA and puts trends on accordingly.

https://github.com/tg12/most_shorted_stocks That is where the FCA by law has to publish a list of institutional investors that hold short positions. This downloads the spreadsheet that is updated at 3PM every day and then does a tally up. There has got to be some information useful in there somewhere.

More Info https://www.fca.org.uk/markets/short-selling/notification-and-disclosure-net-short-positions

 

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  • 1 year later...
Guest Nadiia123

Hello! I have been researching a lot on a topic connected o algo trading for GBKSOFT. What I can say for sure, is that algorithmic trading strategy is one of they key issues influencing the quality of deals won!

 

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