Frequently Asked

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WHAT IS AN AUTOMATED TRADING SYSTEM?

An automated trading system is a programmed investment strategy based on a set of mathematical rules or statistical patterns which provide us buying and selling signals about the underlying asset or target market. Being programmed in advance, the buying and selling signals run automatically without the need of human intervention.

These strategies are created by skilled programmers and experts of the stock market, the so-called system developers. Thanks to their experience, the ongoing analysis of markets and the study of statistical historical data, they are perfectly able to determine which are the best patterns to enter and exit the market, trying to improve the trading strategies.

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WHY SHOULD WE OPERATE WITH FUTURES?

The systems that we have created operate on futures because they make easier to work in markets both in bull and bear positions and with various investment strategies, intra-day or in the longer-term, continuous.

Futures enable us to diversify in the short-term with intra-day operation or with several days swing getting very interesting yields, as being leveraged products. 

A significant factor is that futures provide a higher quality in operations over other financial derivatives because they are regulated, controlled and supervised by the competent authorities, having clearing house. 

In turn, they have great liquidity and allow us to get contra-accounts in operations at the desired price, highlighting that commissions are lower regarding to other underlying assets about the same amount invested. 

There are futures contracts on commodities, stock indexes, interest rates, currencies… which offers us a wide range of trading possibilities.

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WHAT ARE THE ADVANTAGES OF AUTOMATED TRADING?

There are many advantages of automated trading regarding discretionary trading. Let’s see the outstanding ones: First, automated trading allows for respecting 100% the investment strategies. Being automated, the orders are executed without being affected by external or human factors which prevent from operating precisely. 

Automated trading also avoids to be continuously before the computer, since it can be hosted on servers from where the orders automatically are launched when it detects the entry and exit signals programmed in the investment strategies. 

The lack of influence of the psychological factor of the trader is one of the biggest advantages. The machine never gets influenced by the pressure or the euphoria of the moment which always affects the personal trading. 

Automated trading also allows us a greater diversification in our operations since it can cover a bigger number of markets and strategies, operating 24/7 without physical or psychological strain. 

Finally, it offers us greatest investment strategies since programmed systems allow a better adaptability to the market changes. They add non-stop optimizations as they are getting more and more data on prices and values, together with the ease of introducing new indicators in order to improve and adjust the parameters of the trading systems.

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HOW TO ACTIVATE THE TRADING SYSTEMS?

In order to activate our YAtrading systems, since they are hosted on the TradingMotion–iSystems servers -company responsible for monitoring them in a 100% automated way along the different worldwide brokers- the customer only has to open an account in the preferred one. 

LIST OF AUTOMATED SYSTEMS BROKERS 

 Once you have the account with the chosen broker, it will provide you key and password for the TradingMotion–iSystems platform, where you can activate and deactivate in just one moment all the systems you want and replicate all the signals that the algorithms have fully automatically programmed in your account. 

All trading Systems are audited by TradingMotion–iSystems with no possibility of modifying the quantitative algorithms, once hosted on their computers. 

On each system file you can see the backtesting period and the execution period in real accounts fully differentiated and updated at the time, with the slipagge occurring in the markets, the overall results, series of drawdowns, brokers commisions… etc. 

We have to point out that operations are made without having to download any additional software on your computer. Thus, we are able to have a 100% automated trading and to control it from the Control Panel on any access to the Internet, removing completely the emotions.

and looking for systems with no correlation. However, if the systems were correlated operating in a similar way, they would lose or win both and the risk would not decrease but increase.

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WHAT OR WHO IS A TRADING SYSTEM DEVELOPER?

A developer of automated trading systems are those persons or companies who develop the automated trading systems thanks to their knowledge and research of markets. They identify repetitive patterns in order to operate systematically and continuously, eliminating the psychological factor in decision-making. 

Usually, they are computer programmers, mathematical engineers or experts in finances passionate about trading who create quantitative algorithms to check whether the strategies employed in discretionary trading could be also profitable in systematic trading. Developers also programm trading strategies by request of customers so that they can be used in an automated way. 

These automated systems can be for private use only or they can be sold or leased as any existing software in the market. 

Under no circumstances we have to confuse the developer of automated systems with the brokers where the orders are executed. The developer only gets paid for the use or creation of the software being the customer the one who finally decides to use it or not with the corresponding broker. 

Automated systems are investment strategies used in discretionary operations which evolve in order to ensure stability in the markets and with the aim to respect the patterns in the entry and exit decision-making. Automated systems base on past prices and create statistics guidelines hoping to repeat

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HOW MUCH MONEY DO WE NEED TO OPERATE WITH AUTOMATED SYSTEMS?

It is recommended to assign a capital to these automated trading systems strategies that the trader does not require immediately and, in turn, allows him to feel psychologically comfortable in order to respect the selected strategies. 

We must be aware that all operations have losing streaks called drawdown, which always occur. There is no system that always wins. Drawdowns can last shorter periods or be limited in amount but we must take them into account and choose the market which better adapts to us. 

Generally we have to set the risk profile we want to assume. 

Example: 

System that operates on the DAX future, with intra-day operation, with a maximum historical drawdown of 5,000 and broker guarantees for the future of 6,600. 

Risk profile = resulting by multiplying the maximum drawdonwn by the correcting ratio “risk profile”, plus the guarantees. 

Illustrative values ​​= 0.5 highest level of risk profile to 3-5 less risk level. 

Specific case of example,  with a strategy of profile 2. 

MAX HISTORICAL DD = 5,000 X 2 = 10.000 + Guarantees of the future required capital example DAX 6,600 = 16,600.

16,600 would be the resulting capital in order to activate this DAX system with intra-day operation, with a risk profile 2. 

These values ​​are only illustrative and each customer has his own characteristics. If necessary, it is recommended to ask your broker for independent advice for a proper understanding.

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HOW MUCH DOES IT COST THE USE OF AUTOMATED TRADING SYSTEMS?

utomated trading systems have a cost for the user license that appears detailed in the pertinent file and which varies depending on the system to be replicated. 

We have to point out that in the statistics shown on each file provided by Tradingmotion–iSystems -company which monitors the implementation of the systems into the different brokers-, are already discounted the user license fees and the average costs of execution of the broker, showing only the Net Yields.

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WHAT IS THE COMBINATION IN TRADING SYSTEMS?

The advantages of trading futures regarding other underlying assets, together with the combination of systems, provides us the required diversification in our investment to achieve success.

 All trading system has negative streaks called drawdowns. So, by creating a combined portfolio of strategies and markets we will be able to compensate the losses of some systems with the benefits of others ones getting this way a stable curve of benefits over time.

 Thus, the total drawdown of the combination is less than the sum of all individual systems, if there is no correlation.

 A system can enter and give a loss of  -500€ and another one can enter and win +1.000€, the result of the session would be +500€.

 This is the great advantage of diversifying and looking for systems with no correlation. However, if the systems were correlated operating in a similar way, they would lose or win both and the risk would not decrease but increase.

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IMPORTANT RISK DISCLOSURE 

Futures trading is complex and carries the risk of substantial losses. It is not suitable for all investors. The ability to withstand losses and to adhere to a particular trading program in spite of trading losses are material points which can adversely affect investor returns. 

The returns for trading systems listed throughout this website are hypothetical in that they represent returns in a model account. The model account rises or falls by the average single contract profit and loss achieved by clients trading actual money pursuant to the listed system’s trading signals on the appropriate dates (client fills), or if no actual client profit or loss available – by the hypothetical single contract profit and loss of trades generated by the system’s trading signals on that day in real time (real-time) less slippage, or if no real time profit or loss available – by the hypothetical single contract profit and loss of trades generated by running the system logic backwards on backadjusted data (backadjusted). 

Note that the Client Fill Trades are reported across all clients utilizing the platform, across multiple brokers, and are not based solely on the performance of accounts at this brokerage. 

The hypothetical model account begins with the initial capital level listed, and is reset to that amount each month. The percentage returns reflect inclusion of commissions, fees, slippage, and the cost of the system. The monthly cost of the system is subtracted from the net profit/loss prior to calculating the percentage return. 

If and when a trading system has an open trade, the returns are marked to market on a daily basis, using the backadjusted data available on the day the computer backtest was performed for backtested trades, and the closing price of the then front month contract for real time and client fill trades. For a trade which spans months, therefore, the gain or loss for the month ending with an open trade is the marked to market gain or loss (the month end price minus the entry price, and vice versa for short trades). 

The actual percentage gains/losses experienced by investors will vary depending on many factors, including, but not limited to: starting account balances, market behavior, the duration and extent of investor’s participation (whether or not all signals are taken) in the specified system and money management techniques. Because of this, actual percentage gains/losses experienced by investors may be materially different than the percentage gains/losses as presented on this website. 

Please read carefully the CFTC required disclaimer regarding hypothetical results below. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN; IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK OF ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. 

The information contained in the reports within this site is provided with the objective of “standarizing” trading systems account performance and is intended for informational purposes only. It should not be viewed as a solicitation for the referenced system or vendor. While the information and statistics within this website are believed to be complete and accurate, we cannot guarantee their completeness or accuracy. As past performance does not guarantee future results, these results may have no bearing on, and may not be indicative of, any individual returns realized through participation in this or any other investment.