In this chapter, we learned that trading system communication is key to trading. The trading system is in charge of collecting the required prices to make an informed decision. If this component is slow, it will make the trading decision slower. Gateways are technically more challenging than any of the other components because they need to deal with the communication. The communication implies that layers are handled perfectly on the computer level; that is, the computer architecture (network layer), operating system (system calls, the driver that talks to the network card, and so on), and the software itself. All of these layers must be optimized so that they have a fast trading system. Because of their level of technical complexity, it is unlikely that you will implement this communication if you have strategies for high-frequency trading. Instead, you will use a system...
Learn Algorithmic Trading
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Learn Algorithmic Trading
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Overview of this book
It’s now harder than ever to get a significant edge over competitors in terms of speed and efficiency when it comes to algorithmic trading. Relying on sophisticated trading signals, predictive models and strategies can make all the difference. This book will guide you through these aspects, giving you insights into how modern electronic trading markets and participants operate.
You’ll start with an introduction to algorithmic trading, along with setting up the environment required to perform the tasks in the book. You’ll explore the key components of an algorithmic trading business and aspects you’ll need to take into account before starting an automated trading project. Next, you’ll focus on designing, building and operating the components required for developing a practical and profitable algorithmic trading business. Later, you’ll learn how quantitative trading signals and strategies are developed, and also implement and analyze sophisticated trading strategies such as volatility strategies, economic release strategies, and statistical arbitrage. Finally, you’ll create a trading bot from scratch using the algorithms built in the previous sections.
By the end of this book, you’ll be well-versed with electronic trading markets and have learned to implement, evaluate and safely operate algorithmic trading strategies in live markets.
Table of Contents (17 chapters)
Preface
Free Chapter
Section 1: Introduction and Environment Setup
Algorithmic Trading Fundamentals
Section 2: Trading Signal Generation and Strategies
Deciphering the Markets with Technical Analysis
Predicting the Markets with Basic Machine Learning
Section 3: Algorithmic Trading Strategies
Classical Trading Strategies Driven by Human Intuition
Sophisticated Algorithmic Strategies
Managing the Risk of Algorithmic Strategies
Section 4: Building a Trading System
Building a Trading System in Python
Connecting to Trading Exchanges
Creating a Backtester in Python
Section 5: Challenges in Algorithmic Trading
Adapting to Market Participants and Conditions
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