Tag: automated trading

Why you should automate your trading strategy?

by Team PHI 1Algo Trading Strategies / Algorithmic Trading

Automated or algorithmic trading is the process of automatically executing trades based on predefined rules by traders. Traders decide the entry and exit points as well as the strategy to be followed by the algo trading system into the system, which automatically executes trades based on this information.

Automated trading comprises 70% of the total trading volumes in the US and other developed markets currently. In India, nearly 46% of the total trades on NSE and 30% of those on BSE are algorithmically performed.

This number is growing even further as algorithmic trading gains more popularity. While algorithmic trading has several benefits in terms of convenience and efficiency to traders, the one that stands out is the ability to automate one’s trading strategy using the algo trading platform.

With algorithmic trading, you can also fully automate the signal generation and execution of a trading strategy. You no longer need to monitor stock prices or put in orders manually.

Let us look at some benefits of automating your strategy in detail:

1. Create and execute multiple strategies simultaneously

While regular trading involves spotting opportunities manually, it leads to a loss of time and opportunities as the trader can only focus on a few things at once.

With algorithmic trading, a trader has the ability to spot multiple trade opportunities without the need for staying on the screen constantly. Even multiple strategies can be executed at the same time.

All the trader has to do is input the strategy codes and punch in conditions related to trade entry and exit points, stop loss condition, etc.

The strategies will then be deployed by the software, enabling the trader make the most of tradeable opportunities.

2. Backtest and Bulktest under many conditions

Automated trading enables backtesting of your trading strategies using historical data. This enables you to gauge the effectiveness of your strategy under various market conditions, thereby reducing your risk during actual trading.

Few software such as PHI 1 even offer bulk backtesting, which aids in identifying scenarios where your strategy may underperform. Additionally, PHI 1 has a scenario grading feature wherein your strategy is graded or scored in multiple market conditions, further minimizing risk.

Strategy Grading in PHI 1 basis various market scenarios
Strategy Grading in PHI 1 basis various market scenarios

3. Save time by saving your strategies in one place

Traders can save a tremendous amount of time by entering strategy codes as well as instructions such as stop loss, take profit, exit point, entry point, and saving these onto the algo trading software.

This allows the trader to focus on monitoring trades and markets more conveniently. Since algo trading software acts super quick compared to humans, execution is also quick, minus the intervention of human emotions.

Thus, you can make the most of quickly moving/highly volatile market scenarios.

4. Get trade diversification

Automated strategies help take care of multiple types of trades as algo software can monitor many markets compared to humans. This enables trade diversification, further cutting down risk.

With multiple automated strategies amid multiple markets, the software can spot opportunities across all markets that it has been instructed to monitor. This protects traders from the concentration risk of trading in a single or very few markets.

5. Eliminate any room for error in execution

When you automate your strategy, there is no room for error in your trades. The algo trading platform will work exactly as it has been instructed. This frees the trader to do more important research-oriented tasks rather than sitting in front of the screen all day trying to spot opportunities.

Automated trading strategies also keep at bay any biases traders may have, as it goes exactly as it should in a predefined manner, whatever the market situation.

Further, it enables the trader to simplify strategies as the trader has to break them down so as to program them. This helps traders get a detailed glimpse into their strategies. Many a time, this also makes traders simplify otherwise complicated strategies.

Want to automate your trading strategy? Try PHI 1

PHI 1’s advanced strategy creator allows traders to create, test, and analyze any automated strategy limitlessly. In addition, its Multi-Symbol Strategy Creator aids in creating over 125 types of strategies.

PHI 1 also provides robust support to create automated strategies through its knowledge section and webinars.

PHI 1 provides all the benefits of algorithmic trading and more–the biggest advantage being that it sets the trader free from the daily, time-consuming tasks by providing all trading tools from screening to execution–at one place. PHI 1 is, therefore, your one-stop solution to automated trading.

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How to automate your trading strategy using PHI 1?

by Team PHI 1Algo Trading Strategies / Algorithmic Trading

A trading strategy is a plan aimed at generating profits by taking a long or short position. Essentially, a trading strategy comprises a set of pre-defined rules followed by traders to make trading decisions.

A good trading strategy is one that factors in risk tolerance, specific objectives, time horizon, and even tax implications.

A well-researched and -executed trading strategy can help traders achieve profitable returns. You can also fully automate the signal generation and execution of a trading strategy via an algorithmic trading strategy.

With an automated trading strategy, the trader no longer has to monitor stock prices or punch in orders manually. Programming is often an important skill in developing algorithmic strategies.

Here’s how you can automate your trading strategy using PHI 1:

1. Hypothesis Formation/Strategy Formation

Hypothesis formation is all about what you think about the market. It is primarily an educated guess (based on confidence levels) about market behavior and the factors causing this behavior.

Thus, if you think the market is trending lower, you may want to short an asset and if you think the market is trending higher, you may want to go long on the asset—all this is based on statistical analysis.

To validate the hypothesis/assumption, you will need to perform hypothesis testing—a statistical method to test the claim, idea, or guess. In hypothesis testing, one needs to analyze the behaviour of samples (a small representative set) to draw insights about the entire population (a larger set).

Example: You may want to invest in stock only if it has given average returns of 15% annually. You check that for the past 5 years, the stock has given average returns of 18% with a standard deviation of 3%. Would you still invest in this stock? Hypothesis testing helps in such decision-making.

The most common steps used in hypothesis formation are to define the hypothesis, set the criteria, calculate the statistic, and reach a conclusion

2. Coding your Strategy

Once you have decided on your strategy, you need to code the logic of your strategy onto a platform. This would include instructions related to trade entry and exit points, decisions on take profit, putting in the stop loss condition, etc.

Many other factors such as trade size, trading capital also need to be factored in, basis your risk profile. PHI 1’s advanced strategy creator allows you to create, test, and analyze any strategy without restrictions, even if it’s an arbitrary one.

Further, with its Multi-Symbol Strategy Creator, you can create all possible quant strategies, be it Mean Reversion, Momentum, Day Trading, Multi-Frequency, Arbitrage Strategies, Pairs Trading, Seasonality/Calendar based Strategies, Forward Curve, and much more.

More than 125 technical indicators are already built-in and ready to use with a single line of code, and the user can define any new price- and volume-based indicator.

Moreover, PHI 1’s team is always there for any support you may need with strategy creation on our platform through interesting webinars, insightful content, and our comprehensive learn section.

You can start creating your strategies on PHI 1 without any coding knowledge. If you want to build an advanced one like Quant or Price-Action based, then you need to have basic knowledge of Python syntax. You can start right away with these trading strategies on PHI 1.

MultiSymbol Strategy Creator

3 Back-testing and Optimization

Back-testing is an essential tool to analyze the strategies you create based on historical data. This is because if the results of backtesting meet your criteria, it elevates your confidence levels while trading in the live market.

And if the results are less favorable, it’s a loss averted! You can always modify, adjust, and optimize your strategy to achieve a more desirable result.

Unlike most tools available in the market, PHI 1 enables bulk backtesting, an essential feature to identify scenarios where your strategy may underperform.

Further, PHI 1 offers scenario grading wherein you can get a score on your strategies in multiple market scenarios such as market crash and volatility, further adding to your confidence.

Scenario Grading

4. Simulator Testing

Now that you’re done with back-testing and optimizing your strategy, it is recommended that you test your strategy in a simulated (virtual trading) environment.

This can give you a crystal clear picture of how your strategy will perform in the live market. You can identify any bugs or edge conditions that might be present in the strategy code and refine your code accordingly.

PHI 1 offers the ability to simulate trades or perform forward-testing so you can gain the confidence of trading with your strategies in the live market!

Simulation

5. Live Trading

PHI 1 empowers a trader right from brainstorming a trading hypothesis to back- and forward-testing it. But wait, there’s more, once you’re ready to trade in the live market, PHI 1 helps you seamlessly deploy and closely monitor your trades too!

Moreover, with PHI 1’s multi-broker integration, you don’t have to be limited to a specific broker. The choice is yours. Even if one broker is having a downtime, you never miss a trade again! Multiple brokers also help you get the best rates.

PHI 1 assists traders throughout their trading strategy creation and execution journey.

Multibroker

Along with its unique features such as custom screeners and advanced risk controls, you are set free from the mundane, daily tasks that would otherwise cost you a lot of time and money. PHI 1 is, therefore, your complete solution to automated trading.

Unleash your trading superpowers with PHI 1. Try PHI 1 for free!

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7 reasons PHI 1 is a unique algo trading platform

by Team PHI 1Algo Trading Strategies / Algorithmic Trading

Consider this: While you may trade for a few hours that work best for you, a trading robot is at it for all 24 hours. That is 3, 4 maybe 10 times as much as a manual trader trades the market. This is a great advantage of algo trading. That said, many algorithmic trading software with a variety of features are available in the market, making it extremely confusing for traders to select the right software for them.

Moreover, most of these software have a few features required by traders and lack others. The key challenge that traders face here is that they need to use multiple tools and additional plug-ins to complete the trading process. There are no tools that constitute a comprehensive solution to algorithmic trading. Further, many of the software are also quite expensive.

This not only diverts the trader’s attention from actual trading but also costs them additional time and money.

Here’s why PHI 1 makes for a unique algo trading platform:

1. Advanced Charting For A Superior Charting Experience:

PHI 1 enables traders to plot several indicators for live updates. It provides traders with free access to real-time and historical charts with more than 120 indicators. Further, PHI 1 has built-in data on equity, futures, options, etc, enabling traders to easily analyze multiple aspects of an instrument, saving the time and cost required for everyday data integration. And with the charts in PHI 1 sourced from TradingView, traders get the same zippy nature of charts with the finesse of PHI 1. Moreover, the charting feature is part of the free plan!

2. Custom Screener Allows Traders To Scan And Filter With Ease:

Although many scanners are widely available, filters are usually limited to fundamentals. PHI 1 allows traders to scan and filter their group of symbols on a customized basis. Thus, traders can do screening based on any arbitrary analysis, with parameters based on price/volume action, volume ranks, and many more. Traders can create custom screeners by providing any mathematical expression with PHI 1.

3. Advanced Risk Controls That Most Platforms Do Not Offer:

Superior risk controls are absolutely essential for a trader. PHI 1 allows a trader to add all the necessary risk controls to his/her investments. Unlike other platforms, PHI 1 not only offers standard risk control metrics but also calendar-based risk controls. Moreover, traders can also create custom risk controls during strategy creation. Within calendar controls, apart from day control, traders can also make use of time control, week control, month control, and date control, giving them space to fine-tune their trading strategy..

4. Give Your Innovation A Go With The Multi-symbol Strategy Creator:

While most algorithmic trading software do not allow long and short rules within the same strategy, PHI 1 has no such constraints. Perhaps, one of the most unique features of PHI 1 is that it allows you to build a strategy with both long and short rules. PHI 1’s Multi-symbol Strategy Creator’s built-in data allows traders to monitor multiple symbols/time intervals/asset classes in a strategy to make trading decisions on one or more of them. Traders can, thus, create, test, and analyze multiple symbols/instruments with minimal effort and come up with highly exotic trading strategies in just a matter of minutes. Watch to see how!

5. Go Limitless with Advanced Strategy Creator and Testing:

Traders can devise any type of trading strategy with PHI 1, even if it is an arbitrary idea. This offers a trader the freedom to experiment with several trading strategies and spot more investment opportunities. Most other platforms do not allow custom strategies outside of templates. The few platforms that allow the creation of custom strategies have their own set of challenges like complex data integration or learning an entirely new coding language. Further, PHI 1 comes with several testing options such as back-testing, scenario testing, market crash, etc.

6. Multiple Pricing Plans Tailor-made To Suit Your Needs:

The platform has a lifetime free plan for plenty of services to chart, screen, and conduct basic research on strategies. The paid plans offer many more features and begin with Rs. 699/month with customized pricing for Enterprise plans. Thus, PHI 1 can be super cost-effective for traders. What’s more, it comes with a 30-day free trial for all plans. Other platforms that provide a similar range of features cost a lot more!

7. Robust Support To Ensure You’re Always At Your A-game:

PHI 1’s team provides support with strategy creation if you already have but need help in creating it on PHI 1. Support is also widely made available through our insightful webinars, broker integration, and a comprehensive knowledge bank.

From all the unique features of PHI 1, the one that takes the prize is that it provides a total solution to systematic trading. Thus, PHI 1 renders the trader free by automating the numerous mundane tasks that would otherwise cost the trader a lot of time and money.

PHI 1 thus offers the unique benefit of freedom via automation so the trader is busy trading and not dealing with the peripherals.

Experience the power of automation with PHI 1. Try PHI 1 for free!

 

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7 reasons why PHI 1 is perfect for Intraday Traders

by Team PHI 1Algo Trading Strategies / Algorithmic Trading / Technical Analysis

As the world moves towards automated trading, much of the hassles that come with manual trading like constant monitoring, excessive time consumption, and emotional bias are being done away with. With the rising popularity of algo trading, Intraday traders today have multiple trading-related tools at their disposal.

But, rather than creating a convenient environment, just as too many cooks spoil the broth, too many tools often distract traders from their main task of trading.

As no tools are available that constitute a one-stop solution to systematic trading, these multiple tools need to be integrated to complete the trading process. This shifts the focus of the trader from exploring profitable opportunities in the market to handling mundane tasks.

This exercise results not only in the waste of time and effort but also opportunity loss, directly affecting the trader monetarily.

Not only that, robust, well-proven tools also come at a high cost and most require knowledge of complex coding and languages.

Keeping in mind the hassles of using multiple tools, what intraday traders need is a comprehensive software that handles the entire trading process. PHI 1 can be the perfect enabler for intraday traders considering this aspect. 

Here are 7 compelling reasons why PHI 1 is perfect for intraday traders:

1. Advanced Charting Allows For Detailed Analysis And Saves Time:

PHI 1 comes with advanced charting features and offers more than 120 indicators for free. Intraday traders can also access real-time and historical charts with PHI 1.

How does this benefit the trader? Traders can plot many indicators for live updates. They can also seamlessly analyze multiple facets of a stock, and free themselves from everyday hassles of data integration.

Further, PHI 1 provides pre-integrated data for all symbols including equity, indices, futures, and options.

This saves a lot of time and effort spent on data integration. The trader is also assured of accuracy of data and can use the saved time to spot opportunities in the market.

2. Sit Back & Relax While Your Tried-And-Tested Strategy Plays Itself Out:

PHI 1 allows traders to automate their trading strategy so they can sit back and relax. How? Traders can create any type of trading strategy with PHI 1, even if it is just an arbitrary idea.

Unlike most other platforms, PHI 1 allows the creation of custom strategies outside of templates. PHI 1 offers several testing options as well.

With PHI 1’s Multi-symbol Strategy Creator, the built-in data allows traders to monitor multiple symbols/time intervals/asset classes in a strategy to make trading decisions on one or more of them.

Traders can, thus, create, test, and analyze multiple symbols/instruments with minimal effort. Traders can come up with innovative strategies in just a matter of minutes.

These trading strategies once tested can be implemented automatically, preserving discipline and eliminating emotional biases or impulsive decisions. Once finalized, the system will execute orders as per the strategy.

3. It’s On The Cloud!

PHI 1 is a cloud-based software. This means intraday traders do not have to go through the hassle of download or installation.

They can simply plug-n-play the software. Having everything—right from their data to saved strategies–ready can be a major relief for traders. All their data is also securely saved on the cloud.

4. Your Data Is Yours Only:

Your data such as strategies, trades, portfolio, and reports are encrypted and totally safe. Your data is only visible to you, which provides the added benefit of privacy and security.

5. Create Advanced Strategies Limitlessly:

PHI 1 offers an Advanced Strategy Creator which allows traders to create any type of strategy they can imagine of—no restrictions.

This gives scope to the trader to experiment more and more strategies and spot more trading opportunities.

What’s more, PHI 1 provides robust support via documentation. This includes comprehensive coding guidelines. Additionally, our support team is also there to assist you with coding strategies.

6. Backtesting Ability In Multiple Market Scenarios:

Very few tools are currently available for bulk backtesting, which is essential to determine scenarios where the strategy might underperform.

PHI 1 goes a step ahead to provide bulk backtesting along with auto-analysis of strategy performance. Thus, traders get a score on their strategies in a variety of market scenarios such as volatility, market crash, trending, and so on.

This minimizes the risk of trades, and the trader can choose the best strategy to execute whatever the scenario. The result: stress-free trading!

7. Experience The Ease Of Execution With Multi-Broker Integration:

PHI 1 comes with the benefit of multi-broker integration. This means a trader is free to select a broker of his/her choice from a list of available options. This also enables the trader to get the best rates while placing orders.

Moreover, even if one broker’s service is down or the trader does not have enough margin, they can always place trades through another broker. Never miss another opportunity again!

At the core of it all, perhaps, is PHI 1’s endeavour to ascertain ‘freedom’ to intraday traders.

The freedom—to pursue limitless strategies, to spot unlimited trading opportunities, and above all, to only focus on the real deal, and not everyday mundane tasks.

Imagine this – instead of spending every market day staring at your trading screen, you can spend your day trying out new and better strategies while your automated system executes your working strategy flawlessly without you doing anything. Well, with PHI 1, you do not have to imagine!

PHI 1 empowers traders throughout their trading journey via its all-in-one, powerful algo trading platform.

With the ease of use and the scope of scale that PHI 1 offers, it makes perfect sense to try PHI 1!

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5 Benefits of Algo Trading for Stock Traders

by Team PHI 1Algo Trading Strategies / Algorithmic Trading

Algo trading or Algorithmic trading is an automated program that uses a set of defined instructions to execute a trade. Simply put, algorithmic trading is a set of directions for placing a trade.

Computerized algorithms process data faster, cheaper, and more accurately than humans. Algorithmic trading helps make robust trading decisions by efficiently processing data―precisely why it is becoming increasingly popular in India.

There are numerous advantages of algorithmic trading over manual trading. For instance, it saves the time needed for supervision and execution in manual trading. Algorithmic trading also helps traders benefit in measures of speed and accuracy.

Let us look at each of the advantages of algo trading in detail.

1.   It is incredibly fast

In algorithmic trading, algorithms are written beforehand so the instructions are executed automatically. The speed is so fast that it’d be nearly impossible for a human eye to spot it.

Multiple indicators can be scanned and executed in a jiffy! Thus, trades get analyzed and executed faster. Automated programs generate orders with profit targets and protective loss stops, all at once. This implies that traders and investors can swiftly book profits off small changes in price.

2. It allows you to place accurate trades

Unmatched accuracy is a key advantage offered by algorithmic trading. Manual trading has lots of space for committing errors in many aspects. However, with algo trading, the probability of mistakes is reduced drastically.

Accuracy is the decisive factor between a good trade and a bad one. In a computer algorithm, the trades get double-checked and any chances of error are eliminated, preventing things from going downhill and enhancing your probability of profiting from trades.

READ :   Top 5 Best Algo Trading Software in India 2021

3. It minimizes emotions to reduce risks to your trades

As is well-known, human emotions play an important role while trading. The human mind is vulnerable to getting carried away by emotions while making a trade, thus affecting the ability to make decisions based on logic.

Emotions like fear, hesitation, greed, indecision, and others can hinder one’s potential stick to one’s trading plans. However, algo trading takes out the emotion from trading. With automated trading, it is impossible to trade impulsively. Thus, algo trading makes trade more decisive for traders and implements orders without ‘second thoughts’.

4. It allows you to identify and prevent bad trades

It is manually impossible for a trader to know which strategy will work in a given situation. Backtesting allows traders to assess the viability of a trading strategy by showing how it would have worked on a set of historical data. If the backtesting works, traders may develop the confidence to deploy the same strategy in the future.

Thus, backtesting reduces the number of loss-making strategies, making way for the most productive strategies to be implemented.

5. It saves time and is cost-effective

Last but not least, algo trading is a cost-effective way to trade. Manual trading involves spending a lot of time behind the screen and investing a lot of energy constantly to identify trading opportunities. Continuous supervision is tiresome and causes the trader to miss out on opportunities.

Algo trading reduces this time investment and works just fine without hectic supervision. By being relieved of the mundane chores like data integration, traders can focus on exploring opportunities in the market and how to exploit them to their advantage.

Further to cutting down costs in terms of the time invested, algorithmic trading is particularly useful for large order sizes in terms of cost saving.

In addition to these benefits, trade rules get established in algo trading and are performed automatically; hence, one’s discipline stays intact even in volatile markets.

Algo trading solidifies discipline because the pre-defined instructions will be followed as they are. Moreover, algorithmic trading systems allow trading with multiple accounts or implementing various strategies simultaneously across a wide range of markets within seconds, thus diversifying your trades.

Algo trading makes trading convenient and unlocks your true potential as a trader. Algorithmic trading can be a great blessing if done using the right platform.

This is where PHI 1 comes in.

With its easy-to-use intuitive interface and advanced features, PHI 1 provides an end-to-end solution for traders, helping them focus on trading, rather than on daily, mundane tasks associated with it.

Get the benefits of speed, accuracy, and reduced costs with PHI 1’s advanced screening, superior backtesting, advanced risk controls, multi-symbol strategy creator, and multi-broker integration.

No download, no installation, and no data integration required, saving your time! A lifetime free plan to paid plans with even more features, saving your money!

Get the best of algo trading and the ultimate freedom to unleash your trading superpowers with PHI 1.

PHI 1 – Setting you free

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Top 5 Best Algo Trading Software in India 2021

by Team PHI 1Algo Trading Strategies / Algorithmic Trading

Does algorithmic trading sound like rocket science to you? Truth be told, it’s not as complex as it sounds.

In this guide, we clear the air around the myths of algo trading and simplify some seemingly difficult concepts!

Here’s what you will learn:

1. What is algo trading? Is it safe?
2. Benefits of algo trading
3. What do you need to get started? Is coding knowledge mandatory for algo trading?
4. How to create your algo trading strategy/criteria?
5. How will your algo trading strategy work automatically?
6. How to analyze your trading performance?
7. Which are the top 5 algo trading software in India?

 

1. What is algo trading? Is it safe?

Algo trading or algorithmic trading, which is also known as automated trading or black box trading, uses a computable program that executes trade orders following a set of instructions fed by the trader.

The instructions comprise various aspects of a trade such as price, quantity, conditions, instruments, values, and so on.

For example, the trader can instruct the program to execute a buy order from the 1st to 5th of this month (time), for 50,000 shares (quantity) of a stock as soon as the price of the stock goes above its 50-day moving average price (indicator-based condition).

The trader can also set conditions to sell these shares, e.g., if its price moves below the 200-day moving average price.

When these two instructions are fed, the computer will automatically monitor the pricing of the stock as well as its moving average and execute the buy or sell orders when the set instructions are triggered.

The trader, therefore, does not need to monitor the price continuously or plot graphs to ascertain the moving averages, or even put in the orders manually.

The algo trading software does all the activities on its own by following instructions to the letter.

Algorithmic trading is safe when you develop a proper understanding of the systems, markets, and trading strategies.

Today, about 70% of the total trading volumes in the USA and other developed markets are executed via automated trading.

In India, too, approximately 46% of the total trades on NSE and 30% on BSE are automated.

This number is growing even further as algo trading has many benefits when compared to conventional trading.

 

2. Benefits of Algo Trading

The main benefit of algo trading is that trading can be done with a speed, frequency and accuracy which are usually impossible for a human being.

With algorithmic trading, the trader can also fully automate the trigger generation and execution of a trading strategy. You no longer need to monitor stock prices or put in orders manually.

Here are some detailed benefits of algo trading:

a. It is incredibly fast

In algo trading, algorithms are written beforehand so the instructions are executed automatically.

The speed is so fast that it’d be nearly impossible for a human eye to spot it.

Multiple indicators can be scanned and executed in a snap! Thus, trades get analyzed and executed faster

 

b. Create and execute multiple strategies simultaneously

While regular trading involves spotting opportunities manually, it leads to a loss of time and opportunities as the trader can only focus on a few things at once.

With algorithmic trading, a trader has the ability to spot multiple trade opportunities without the need for staying on the screen constantly.

 

c. It allows you to place accurate trades

Unmatched accuracy is a key advantage offered by algorithmic trading.

Manual trading has lots of space for committing errors in many aspects.

However, with algo trading, the probability of mistakes is reduced drastically. Accuracy is the decisive factor between a good trade and a bad one.

 

d. Algo trading allows you to identify and prevent bad trades

It is manually impossible for a trader to know which strategy will work in a given situation.

Backtesting allows traders to assess the viability of a trading strategy by showing how it would have worked on a set of historical data.

Backtesting trading strategies reduces the number of loss-making strategies, making way for the most productive strategies to be implemented.

Few algorithmic trading software such as PHI 1 even offer bulk backtesting, which aids in identifying scenarios where your strategy may underperform with the scenario grading feature, wherein your strategy is graded or scored in multiple market conditions, further minimizing risk.

 

e. You can save time by saving your strategies in one place

Traders can save a tremendous amount of time by entering strategy codes as well as instructions such as stop loss, take profit, exit point, entry point, and saving these onto the algo trading software.

Thus, you can make the most of quickly moving/ highly volatile market scenarios.

 

f. Get trade diversification

Automated strategies help take care of multiple types of trades as algo software can monitor many markets compared to humans. This enables trade diversification, further cutting down risk.

With multiple automated strategies amid multiple markets, the software can spot opportunities across all markets that it has been instructed to monitor. This protects traders from the concentration risk of trading in a single or very few markets.

 

g. Eliminate any room for error in execution

When you automate your strategy, there is no room for error in your trades. The algo trading platform will work exactly as it has been instructed. This frees the trader to do more important research-oriented tasks rather than sitting in front of the screen all day trying to spot opportunities.

 

h. Minimize emotions to reduce risks to your trades

As is well-known, human emotions play an important role while trading. Emotions like fear, hesitation, greed, indecision, and others can hinder one’s potential to stick to one’s trading plans.

However, algo trading takes out the emotion from trading. With automated trading, it is impossible to trade impulsively. Thus, algo trading makes trade more decisive for traders and implements orders without ‘second thoughts’.

 

i. Save time and money

Last but not least, algo trading is a cost-effective way to trade.

Manual trading involves spending a lot of time behind the screen and investing a lot of energy constantly to identify trading opportunities.

Algo trading reduces this time investment and works just fine without hectic supervision. By being relieved of the mundane chores like data integration, traders can focus on exploring opportunities in the market and how to exploit them to their advantage.

 

3. What do you need to get started? Is coding knowledge mandatory for algo trading?

Implementation of the algorithmic trading instructions using an algo trading software is the final step in algo trading. The real skill is to translate a trading strategy into a set of instructions which are recognized and actionable by the computer program. Thus, the basic requirement for algo trading is as follows:

  • A trading strategy i.e. entry and exit rules
  • Coding knowledge in languages such as python to program a trading strategy (There are some algo trading software like PHI 1 that can offer form-based inputs and can help devise the strategy without coding knowledge. Learn how! Also, many such platforms also offer coding services.)
  • Strong Internet connectivity to access markets, the algo trading software, get real-time stock movement information, and place orders
  • Access to market data which can be monitored by the trading software
  • Access to a robust and user friendly algo trading software that can assist in evaluating your strategy by backtesting and forward testing before execution.
  • Basic technical analysis knowledge, financial markets knowledge, and the ability to identify and make sense of chart patterns.

(PHI 1 offers an advanced strategy creator that allows traders to create any type of strategies—even arbitrary ones. This enables the trader to explore novel ideas and exploit more opportunities in the market. Learn about automating your trading strategy here.)

 

4. How do I create my algo trading strategy/criteria?

You create algo trading strategies by coding your strategy or using form-based strategy creators.

Here, you simply put in the desired values for different variables like time, price, quantity, mathematical models, technical indicators, momentum indicators, etc.

Then, you can run this strategy on the instrument you want to trade in.

You can also save your strategy and deploy it when your criteria are met automatically.

But, before running the strategy to trade it is always better to test your strategy on historical data so you can see the result of how your strategy would have performed historically. This is known as back testing.

Traders usually combine a variety of technical indicators to come up with trading ideas and strategies to execute a trade profitably.

Some tried and tested trading strategies like Moving average strategies, Average Directional Index strategies, Relative Strength Index (RSI) strategies and MACD strategies can be used right away on an algo trading software.

 

5. How will your algo trading strategy work automatically?

Once you have created your trading strategy and chosen the scenarios when you want the strategy to get executed, you can choose a broker with whom you want to execute the trade.

Algo trading platforms like PHI 1 offer multi broker integration wherein you can select from a list of multiple brokers.

Then you can run your strategy, and it will work automatically and the trades will be executed once the strategy parameters are met.

 

6. How to analyze your algo trading performance?

Planning a trade involves deciding the time you want to commit to trading, your trading goals, deciding how much capital you want to allocate, risk levels, and your entry & exit points.

Then, you would need to focus on technical parameters such as research on securities, markets, trading opportunities, setting risk controls, creating a strategy, and evaluating the strategy.

You may use various metrics like win rate and Sharpe ratio.

 

7. Which are the top 5 Best Algo Trading Software in India in 2022?

Traditionally, traders have been automating their trading process using custom-made trading software and Excel macros. While both are time-consuming, the former is also quite expensive and the latter requires extensive human effort and only partially automates the process.

With various amendments in trading laws over the years, algo trading has gained rising popularity in India. To facilitate this, several algorithmic trading software and tools are available in the market.

Good algorithmic trading software is one that allows easy access to market and broker data, supports multiple instruments as well as markets, allows creation and testing of any trading strategies, has a user-friendly interface, provides readily available reports, has a reliable architecture as well as efficient order management and execution capabilities.

With the market inundated with many such algo trading platforms, we curate the top 5 algo trading software in India. We also compare their features, pricing, and limitations to make it easy for you to choose what suits you best.

 

Top 5 Algo Trading Software in India 2021

 

1. PHI 1

PHI1 - Best Algo Trading Software

Key Features:

  • Provides backtesting, scanning, analytical, and deployment tools all-in-one, making it a one-stop solution for systematic trading
  • Allows multiple testing strategies like bulk backtesting, grading on scenarios, and scenario backtesting
  • Advanced Charting for plotting multiple indicators for live updates
  • Multi-symbol Strategy Creator enables a user to create, test, and analyze multiple symbols or instruments with ease
  • Provides over 120 indicators for free
  • Intuitive and easy-to-use interface
  • Offers standard and calendar-based risk controls
  • Offers multi-broker integration
  • Users can create custom screeners by supplying a mathematical expression
  • Single dashboard to monitor the trading by date interval, strategy, time-frequency
  • No download or installation required

Pricing:

The platform has a lifetime free plan with enough services to chart, screen and do basic research on strategies.

The paid plans begin with a basic monthly plan of Rs. 699/- which allows you to take your strategies live and is one of the most affordable algo trading software in India.

Limitations:

  • Currently, PHI 1 provides data only for Indian Markets.
  • Knowledge of basic Python Syntax is required to define trade entry and exit conditions.

2. Zerodha Streak

Streak Zerodha Algo Trading Software

Key Features:

  • No requirement of prior knowledge of coding
  • Easy to operate with steps like create strategies, backtesting on the basis of maximum gains, maximum loss, average gains, average loss, etc. with a lookback period of up to five years, making it one of the best algo trading software in India 2021
  • The algorithm can be deployed in up to 20 scrips at once
  • Active real-time triggers, actionable alerts, and notifications
  • No download or installation required

Pricing:

Provides 4 monthly plans, starting with a basic plan of Rs. 500/month, a premium plan of Rs. 900/month and an ultimate plan of Rs. 1400/month. The plans come with a daily limit on scans and backtests.

The platform also offers quarterly plans starting from a basic plan costing Rs. 450/month effectively.

Limitations:

  • Presently has limited tools and indicators for technical analysis
  • Not free to use. Has a 7-day trial period.
  • Cannot be used for commodity/currency trading
  • No advanced charting and no order execution
  • Cannot create custom screeners
  • Cannot code custom strategies outside of predefined indicators.
  • Requires manual intervention for order entry.
  • Cannot create Pairs trade or arbitrage type multi-symbol strategies.
  • Cannot monitor multiple different time frames to make a decision.
  • Cannot monitor the equity and its derivatives to take a decision in the strategy.
  • Lacks real-time portfolio monitoring

3. Amibroker

Amibroker

Key Features:

  • Advanced real-time charting with portfolio backtesting and optimization
  • AmiQuote, a universally free quote downloader, collects current, end-of-the-day, and historical data from finance sites
  • Amibroker Formula Language (AFL) code wizard with the addition of code editor enables a user to use English words to create customized technical analysis formulae
  • Functions like Exploration and TradeRisk to create custom filters and risk control
  • Automatic order execution
  • Allows to trade directly from charts using an auto-trading interface (which works with Interactive Brokers)
  • Additional functions like custom metrics, rotational trading, multiple currency support, portfolio-level monitoring, etc.

Pricing:

AmiBroker – Technical Analysis Software is available as a single-user license with a first-time user license starting at $279 for the standard edition, up to $499 for the Ultimate Pro Pack. AmiQuote – Universal Quote Downloader and AFL Code Wizard charge a Single User License fee of $99.

Limitations:

  • Requires learning of complex Amibroker custom language to create strategies and code testing options
  • Lack of a standard template, the requirement of writing the code can be challenging for beginners
  • Mainly suitable for big traders who have tech team/ assistance at their disposal due to the coding requirement for strategy creation and debugging
  • Relatively expensive
  • Available only for desktop
  • Can only run one database per instance/ session, which implies that you cannot open more than one database without opening multiple instances of Amibroker
  • Requires buying of a bundle to access add-on features like AmiQuote and AFL Code Wizard

4. Ninja Trader

Ninja Trader Algorithmic Trading Software

Key Features:

  • Available for free to users with a Funded Account® for using standard features like charting, market analysis, and live trading, with partial and full strategy automation
  • Ninja Trader Ecosystem, a third-party developer community, has a plethora of third-party apps and add-ons available for the platform’s users
  • SuperDOM order entry and trade management system grant enhanced customization
  • Automated Trade Management (ATM) strategies are a part of the Trade + Feature Suite
  • Chart Trader enables users to place and manage trades directly from a chart
  • The number of strikes for Option Chain has been increased
  • Additional tools include Time & Sales, Level II, Hot Lists, etc.

Pricing:

Ninja Trader has three plans – Free, Lease, and Buy. The free plan allows the use of advanced charting, backtesting, and trade simulation.

The Lease plan starts with a monthly fee of $60, while the Buy plan comes for 4 monthly payments of $329 each or a one-time payment of $1099.

Limitations:

  • Free plan with a Funded Account® only includes basic features. To access premium features, users need to lease or buy the packages, where pricing can go on the higher side.
  • Ninja Trader is available on desktop only on Windows
  • Need to use a supporting broker to trade equities
  • NinjaTrader brokerage clients can use the CQG mobile app, but no app available yet if one is using another broker.

5. Meta Trader 5

meta trader 5 Algorithmic Trading Platform

Key Features:

  • Specialized integrated development environment MQL5 IDE enables traders to create, debug, test, optimize and execute trading robots
  • Strategy Tester enables visual testing, genetic algorithm, optimization, etc.
  • MQL5 Wizard generates the Expert Advisor Code to create trading robots for beginners
  • Four modules of execution – Market, Instant, Request, and Exchange execution
  • Market Liquidity Pool to monitor the market depth
  • Additional services like MetaEditor, strategy developers’ database, copy-trading, and virtual hosting

Pricing

For Traders, MetaTrader 5 trading platform has an initial deposit.

For Brokers, the platform has three variants – Entry, Standard, and Enterprise depending on their requirements.

Limitations:

  • Hedging for exchange markets is disabled
  • MT5’s programming language MQL5 is different from MT4’s MQL4, requiring traders to relearn coding and techniques
  • The programming language and advanced features might be difficult for beginners

 

We just reviewed the top 5 algo trading software in India.

With there being multiple options for algorithmic trading platforms in India, one can be spoilt for choice!

We urge you to choose an automated trading software that suits your requirements and preferences.

 

Why try PHI 1?

Whether you are new at algo trading or a seasoned trader, you have seen enough compelling reasons to try PHI 1.

The one that takes the prize is that it is a one-stop solution for systematic trading. PHI 1 is built for traders with the aim to set the trader free from daily mundane tasks so you can focus on the real deal!

Unleash your trading superpowers with PHI 1’s end-to-end algo trading software.

Get a free trial for one of the best algo trading software in India 2021.

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