Citation:
"The introduction of CFDs
was the biggest revolution for the private investor! The
clear advantage with this derivative is that you move like a
pro in the markets and to trade with low capital big
commercial volumes is possible.
The biggest difficulties of the private investor lie in the
position and risk management; at short notice he keeps to
this though and earns therefore for a short time also
profits, nevertheless, after some time he can be often
tempted to a higher risk readiness (avarice) and loses the
whole amount again.
The private investor often has a very good strategy because
he does not keep, nevertheless, to his own rules, the loss
of his capital follows from it.
To be able to act with the possibility for the private
investor now also automated, so he can trade his own
strategy fully automatically via broker, the biggest and
probably most important step is done with certainty for the
private investor. Since now he also has to be active the
possibility beside the normal work round-the-clock in the
finance markets and can follow therefore the trading not
only in his spare time.
Currently approx. 70% of all shops about Xetra and Eurex via
fully automatic systems are traded, however, not by private
investors, but only by institutional investors. However, now
it is also to be positioned for private investors quite
simply possible to themselves with own automated commercial
system in the international markets and to use therefore the
complete advantages of the automated tradings."
Patrick Hahn
Automated trade?
Definition
Automated
or algorithmic
trade enables to give up orders without human
intervention on the
stock exchange
on the basis of predefined, quantitative models. It is the
attempt to substitute for the person as a
broker
and with it direct participant in security trade.
The
algorithm fixes the split up
and the timing of the orders with the help of predefined
parametres. These parametres usually use historical as well
as topical market data.
Algorithmic trade is
used by brokers, on the one hand, for own trade, is offered
on the other hand, however, also to the customers of the
brokers as a service (on account of the complexity and
resource situation institutional investors have a certain
urge to access solutions of brokers).
The
advantage of automated trade is the high speed in which they
can place
deals,
and observe the higher amount in comparison to the human
being in relevant information, and process them. With it
lower transaction costs also walk along.
The
difficulty with algorithmic
trading lies in the
aggregation and analysis of
historical market data as well as the
aggregation of real time
courses to allow trade. Also putting up and testing of
mathematical models is not trivial.
Condition
for algorithmic
trade is that already an order or a commercial
strategy is given. Here it is a matter in contrast to
automatic trade or rate machines of distributing an order
intelligently at different markets. It is not a matter of
shooting quotes in the
market on the basis of parametres automatically.
For the
development automated trade: Stock exchanges report about
one up to 50% of portion in the stock market turnover. In
the Eurex automated trade
has quadrupled itself during the last three years
(2004-2006). Traditional trade has grown against it only
easily. The
EUREX
supposes that at the moment approx. 20% - 30% of the whole
turnover originate from automated trade. Within the
EUREX
you count on a growth rate of about 20%
per year.
Among the
rest, automated trade is also known under the name Algo-,
Black Box-, Grey box-Trading.
The
computer programs
for this purpose are called
RoboTrader.
In contrast
to the
computer stock exchange
at which
computers
serve only as a communication platform for the linking of
suitable purchase and sales offers the system places
independently such
offers
and searches trading partner for itself.
Advantages
·
You have not to
place the orders themselves or close and also be online not
constantly. You can start to trade at every time from your
computer or stop. Thus you have any time idea and full
control of your personal commercial discount payment and all
transactions!
·
human emotions
are eliminated and discipline are raised
·
Quickness
·
Expeditiously
·
24 hours daily,
5,5 days the week trade (nobody miss from signals)
·
Diversification
in new magnitudes (in different time frame, currencies and
commercial systems)
·
quick checking
of own or foreign commercial attempts by backtesting of the
signals in the past
For other
informations we recommend seminar, consultation and
trainings:
www.meta-trader.de
