- How long have you traded?
I have been trading for a long time. I remember my first operations, as a student, when I invested my savings in shares of major companies. I was based on the recommendations and analyses found in different financial newspapers and television channels, making my own interpretations and forecast. With time and ongoing training, I developed my own investment strategies mainly focused on technical analysis, putting into practice what I found in books and specialized courses, looking for patterns that could give me advantages when taking my positions. Thanks to them and the experience in markets, I understood the importance of the psychological factor and how it affects discretionary trading negatively.
- How did you turn to automation?
I turned to automating investment strategies after analysing there was no use in being on the computer almost 14 hours a day following graphics, recreating a very clear method which left nothing to subjective interpretation; it was followed by the need to know how that strategy would behave in other kinds of trend situations, lateral market, with less volume, etc. to achieve greater consistency and confidence in the methodology.
- Is Automation different than discretionary trading when you develop a method?
The automation of a system must be the evolution of a success strategy manually operated,and it is leaned on automation to avoid the trader’s exhaustion, both physical and psychological.
- What is your favorite instruments when you develop a method?
The instruments I like most to operate automated systems are futures trading systems, because they allow us to operate in markets, in both bullish and bear positions and with different continuous investment strategies, intraday or longer term.
They provide quality operations over other financial derivatives and, as it is a product regulated, controlled and supervised by the competent authorities, it has clearing houses.
Futures have a great liquidity to obtain balancing entries at desired price, besides commissions are lower in executions over other underlying on the same amount invested.
Futures contracts have a wide range of possibilities as they exist on commodities, stock indices, interest rates, currencies, etc.
- How long can an automated strategy work for?
I believe that if the trading system is well done without an over-optimization in its initial settings, it can last long without requiring any substantial change. What we need is a continued monitoring just in case it requires some readjustment by scheduling issues, trading volumes or objectives.
- What is the language you use for automation, Easylanguage? Any specific preference for a trading language?
We program in different languages but my favourite is Visual Basic, because it is a very flexible and strong language with many possibilities.
- What edge do you think you provide in your trading that people may be missing if they are discretionary traders?
The edges are many but the most important one is to respect the investment strategies at one hundred per cent. Automated orders are executed without being affected by external factors or human intervention.
Automated systems save us from being on the computer continuously since they can be hosted on servers, where orders are launched automatically once they detect programmed inputs and outputs.
The absence of psychological factor is an important point since the machine is not affected by pressure or euphoria at the time of the decision making. This allows us greater diversification in trading operations as more markets and investment strategies are covered.
Automated systems also provide us greater adaptability to changes, with continuous monitoring, as more data on market quotations are obtained.
- Why did you choose TradingMotion – iSystems for your systems?
We chose TradingMotion – iSystems because it provides us with support in executing orders in a fully transparent and direct way with different brokers worldwide. It has over ten years experience and a professional team specialized in automated trading with constant improvement and know-how.
TradingMotion – iSystems has a differentiated technology with very low latency when sending orders directly to different futures markets within milliseconds, which is a very important value in trading.
- Do you think more traders should move to automation? Or some discretionary systems could never be turn into automation.
Operating with automated systems will be on the increase during the years as it has been noticed when the edges over discretionary systems are understood. We must be aware that every investment strategy can be scheduled if the trader is able to define leaving nothing to subjective interpretation. As the only way to be 100% respected and know the real results, it is the final target of making an investment diary that every trader must have if they want to succeed.
- Any final words?
Automated trading systems must be the result of operational discretionary trading which rely on programming, to be 100 % respected, and which do not produce physical or psychological exhaustion on the investor.