3 easy-to-use-trade automation systems for retail traders

By Ong Kai Kiat March 14, 2017

Helps in achieving more consistent trading results by maintaining discipline even in volatile markets
Programs are not afraid to take losses, will ride winners for longer without losing their nerve

3 easy-to-use-trade automation systems for retail traders

RECENTLY, I read an interesting news article on the increasing popularity of automated trading in India. The various forms of automated (also referred to as algo) trading account for 50% of overall trading in India and 85% in the United States last year.

The Singapore fintech scene of payments, insurance, crowdfunding and regulations are all well covered. MAS gave official recognition to the booming fintech industry with the inaugural Singapore Fintech Festival last November. However, one area is somewhat neglected: automated trading.

The idea behind automated trading is simple. You define a set of trading rules and the program will automatically execute on your behalf when these are met by market conditions.

Given that it removes the need for you to monitor the market for trading signals 24 hours a day while also keeping your emotions in check, the surging popularity of automated trading is clear.

Three automated trading platforms

Whereas most other forms of fintech are designed to make life more convenient for the user, automated trading falls under the self-directed investing category.

In a nutshell, automated trading assists private individuals in achieving more consistent trading results by maintaining discipline even in volatile markets. Contrary to normal human reflexes, these programs are not afraid to take losses and will also ride winners for longer without losing their nerve.

Hence, I thought that it would be useful to list three automated trading platforms for the average man on the street. They do not require you to understand MQL or any other complicated programming language which is typically a key barrier to algo trading. They all have Graphical User Interface (GUI) wizards for you to create your own trading strategies.

1. Tradeworks

Tradeworks is a SaaS-based trade automation platform where individual traders can create, test and deploy their automated trading rules for the forex, commodity and CFD markets. This platform allows you to build strategies from a wide range of technical indicators (e.g. Bollinger bands) as well as customised indicators and price action signal rules to decide when to enter into a trade.

Many additional conditions like maximum number of trades opened per minute or what trading session to trade (e.g. only New York opening hours) can also be added to a given strategy. The last important element is to decide upon your risk management parameters.

For example, you can decide how much to risk per trade by a fixed amount or percentage of capital or you can also set the stop loss and take profit targets based on outright amounts or based on additional customised rules on the same basis as when designing an entry rule.

When everything is configured properly, you can backtest it within the system. Traders with limited or no experience can also simply start out by deploying one of the many ready-made strategies (some of which are actually profitable) that are provided to showcase the Tradeworks platform.

You can also create several trading strategies in one go for each currency market and choose whether to activate them or revise them according to your results.

Tradeworks provides a free account for traders to test them but they are not allowed to trade real money. For them to connect Tradeworks to a live trading account, traders have to pay US$55/month for the standard plan or US$225/month for the Pro plan.

Tradeworks has a number of partnerships notably with Monex, the largest brokerage in Indonesia.

2. EA Builder

EA Builder has a somewhat wider range of capabilities than Tradeworks in that it also allows automated trading of futures. Similar to Tradeworks, EA Builder allows you to set your own trading rules, set the time period for the execution and manage the risk involved for each trade.

The main drawback of EA Builder is that the trader has to configure his trading rules on the platform and then compile and copy the code onto his MT4 platform manually. This is unlike Tradeworks which is integrated with the online trading platforms and runs without any need for code. For more information, you can refer to the YouTube channel here.

For some traders, the look and feel of the GUI matters. EA Builder has a more functional interface while Tradeworks is more stylish. Besides these standard features, EA Builder has audible alerts when the alerts are hit and human readable output.

3. ProRealTime

ProRealTime has teamed up with online brokerage IG Markets to provide both programming and non-programming methods for automated trading. It supports the widest product range in that it also covers options and many different markets globally.

ProRealTime also includes other bells and whistles such as market scanning tools, automatic drawing of support and resistance lines and low latency datafeed to improve your trading. It has been in the market for 16 years and it is seen as one of the best systems around.

3 easy-to-use-trade automation systems for retail traders

As with the other two services, ProRealTime allows you to backtest before system deployment. This will allow you to determine the expected results as you set the conditions for entry and exit. ProRealTime has been around for the past 16 years since its inception in France and has over 521,000 users worldwide. This video will show you how to get started with ProRealTime.

Comparison Table

All three platforms allows you to create, edit and backtest you own trading strategies with any prior knowledge of programming. You can set the conditions for entry based on the indicators, triggering signals and time of entry. Risk management are provided on all three platforms.

The table below lists down the differences between these three automated trading platforms for your easy consideration.

3 easy-to-use-trade automation systems for retail traders

Having more options might not necessarily be the best for the individual trader. The world of forex itself is wide enough for a lifetime of trading mastery. If you want to focus on the simplest way to enter the world of automated trading, Tradeworks is possibly the easiest option for beginners. Other than that, ProRealTime offers value for money to individual traders (albeit there are many variable costs).

Conclusion

There is no guarantee of profits when we are trading regardless of manual or automated trading. The backtest might come out perfect but it can still fail in real time trading as it is over-optimized to fit the curve.

However, automated platforms allow individual traders to compete on a more level playing field against institutional traders with better speed and quality of execution.

Experts have noted the inefficiencies of capital markets in Asia and how automated trading can improve them by taking operational and implementation risk off the table. In the future, quantum computing might change the game again but for now, these three systems are sufficient for the task.

Ong Kai Kiat is a professional freelance writer who enjoys the process of discovering and collating new trends and insights for an article. He adds value to society through his articles especially those related to finance and technology. He is reachable at [email protected]