AUTOMIZE TRADING MANUAL
AUTOMIZE TRADING SERIES

Or a trader’s mechanical system might have suboptimal feature parameters that do not effectively capture the feature’s predictive value.įor example, ML can be used to choose the dynamic parameters of indicators like MACD for developing an exit strategy based on the context and other factors. Without ML, a trader might develop a rules-based system that is too inflexible to changing market conditions. Use Casesīut the power of ML allows the practitioner to find the optimal signal among a set of rules with varying parameters. While institutions have been doing massive experiments using terabytes of data and GPU clusters, due to the nature of secrecy in the industry, public discussion and research have often been limited to simple price predictions with bare minimal LSTM or ARIMA models. The evolution of AI and machine learning technology is also changing the landscape of algo trading. Trigger Finance’s (now part of Circle) Trump Trigger: Some cloud environment such as Amazon Lambda may be a good solution for this too. Twitter and StockTwits both provide APIs for personal use as well. For ImplementationĪll you need here is a news and/or Twitter feed, which you can constantly monitor for new actionable events. Rather, with Alpaca Trading API, you can automate this if-then-that process into something that continuously scans for news or events and reacts accordingly.

AUTOMIZE TRADING MANUAL

Machine learning, or more specifically natural language processing, might solve some of the problems here, too.įor (b), again, it may not make sense for you to keep monitoring Twitter, StockTwits, Bloomberg or Y! Finance and react to the news with a manual trade. Possible Approachįor (a), it’s the era of data, and you can get historical news and tweets from several sources, and identify keywords or particular events that may have led to a material price movement. News can cause significant changes in a stock price, but it’s challenging to (a) identify such events and to (b) take the right actions as soon as they happen. Elon Musk tweets about taking Tesla private, and the Tesla stock quickly trades higher. The FDA publishes an approval for an outstanding generic application, and one biotech company’s share price jumps up. Trump says something about Amazon, and the company’s share price drops.

AUTOMIZE TRADING SERIES

This is the part 2 of a series “Ultimate List of Automated Trading Strategy Types.” Check out the part 1 for (1) Time-Series Momentum/Mean Reversion, (2) Cross-Sectional Momentum/Mean Reversion, (3) Dollar Cost Averaging, (4) Market Making, and (5) Day Trading Automation.

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