Building blocks of an Algo system
Algo/algo trading, which stands for algorithmic trading is an automated way of order execution on the exchange. This can be achieved by developing a computer program.
There are three parts in an algo trading system.
1. Technical Analysis Platform
A technical analysis platform is software which runs the customer strategy on price action. There are various platforms available in the market on different charting methods.
TradePoint is one of India's best charting platform which provides advanced charting like Point and Figure, Renko, Line-break, Heikin-ashi, Ratio, Relative Strength and Options related charts along with conventional charts such Bar, Candlesticks and all types of indicators.
TradePoint helps design and run winning strategies to increase profitability using its advanced charting and scanning features.
Results of these qualified strategies now can be exported to external algo system by means of supported integration methods in real time.
TradePoint's high performance scanner engine is capable of generating trade signals and sending it out to an algo engine or a broker terminal.
TradePoint itself is not an algo engine. But it can produce superior trading signals which can be sent to an algo engine for decision making and execution.
TradePoint algo connectivity
Tradepoint now supports connectivity with various algo engines by the following means:
- CSV File - CSV files generated by Tradepoint in realtime can be used by algo software to process further. Algo software has to read this CSV file and take trading decisions.
- Multicast - TradePoint acts as a multicast server and trading signals are broadcast over the local network. One has to subscribe to these signals by implementing a multicast client.
- Webhooks - TradePoint can invoke webhooks for every trading signal generated by the scanner. These webhooks are nothing but a valid url representing some web application. Data will be posted to these webhooks in JSON format.
- Telegram - TradePoint can send trading signals in JSON format to the customer's telegram channel.
These are specially designed software which implement trading intelligence. Customer has to define trading preferences based on their funds, risk profile and time horizon. These algo systems receive signals from a technical analysis platform like TradePoint and take decision whether to trade it or not. These systems are further connected to Brokers trading system via API provided by the respective broker.
- Algo System
This software is provided by the broker where the customer holds a trading account. These terminals provides different APIs for performing various transactional and reporting operations. These APIs are
- Trading Terminal
- Required by the algo engine so that orders can be placed, modified, deleted and checked.
- Broker specific and they need to be consumed and implemented by the system which wishes to place trades.
Look under option menu in TradePoint and you will see ‘Algo Setting’. Clicking on this option will open a window for Algo Setting.
- The Algo Configuration window
Algo Status option in the Algo Configuration can be set to ON or OFF
- Toggle signal export from TradePoint
When you set Algo Status to ON it enables TradePoint to export the signals to the medium you have selected.
When you set Algo Status to OFF TradePoint will stop exporting signals.
You can send a test message using the test button to verify if your settings are working correctly.
Setting the signal export to FILE option enables TradePoint to export the signals to a CSV file which can be easily read. The CSV files will be created in the folder specified by the user.
- Export through CSV file
This is the most commonly used option which users prefer for the ease of implementation.
Setting the signal export to web hook option enables TradePoint to export the signals over web hook. The web hook URL needs to be setup in the Algo Configuration window.
- Export through webhooks
Setting the signal export to UDP option enables TradePoint to export the signals over UDP multicast. Your application should have a UDPClient to join the multicast group. The muticast group IP and port needs to be setup in the Algo Configuration window.
- Export through UDP multicast
Setting the signal export to Telegram option enables TradePoint to export the signals over Telegram messenger. The API key and chat id needs to be setup in the Algo Configuration window.
- Export through Telegram
Please remember to restart all scanners after changing any setting in the Algo Configuration window.
- Saving user settings
Each signal has a format as specified in the table.
- Understanding the Algo
Much more is planned for our endevour to make TradePoint one of the best platforms for objective and Algo trading strategies.
More features and integration with brokers - coming soon!