WHAT IS QUANTLER?
Quantler is an open source cloud-based trade automation software designed for individual traders of FX and CFDs. Our goal is to help individual traders optimize their trading performance through innovative but simple-to-use trading technology. Quantler makes it easy to build your own trading algorithms or work from a number of preset trading strategy templates. Unique is our hybrid and social approach where new trading algorithms can be created either with or without programming. This allows for maximum flexibility when creating these algorithms.
What is Algorithmic Trading?
Algorithmic trading, often referred to as automated trading or ATS (automated trading systems) is basically when a machine executes you trading algorithm which may contain a number of rules and criteria that the machine will follow. It will automatically open and close trading positions for you. There are many advantages to automated trading, notably lowering the impact of human emotion, the ability to backtest (simulate) the strategy before enabling it and time optimization given that a machine can monitor the market round the clock.
HOW DOES IT WORK
The basic idea is to build algorithms (or trading strategies) based on one or more technical indicators, statistical calculations, price activity, your money management and risk management rules. Your trading algorithm will then subsequently monitor the market for you and send instructions to open or close positions with your broker or bank from your hosted trading environment IF the market-conditions meet your rules.
For example, you can design a simple algorithm where you open a EURUSD position when the price of has increased by 1.5% in the past 5 days setting your target take profit at 2%.
Of course, your algorithm can be far more complex and feature several different technical indicators and elaborate sets of rules that are interdependent. To help you understand the general algorithm design, we recommend that you take a look at our featured template strategies which are found in all Quantler accounts.
BUILDING AN ALGORITHM
Once logged in, navigate to the backtester, which contains a list of all your templates from which you can build trading algorithms. Initially, the list will only contain the preset template trading strategies. The strategy designer is used for designing your trading algorithm. Quantler will integrate these trading algorithms for trading execution. Thus allowing you to create new trading algorithms without writing a single line of code (if you do not want to code).
Optionally you can edit the code on the code tab, in case you want to make alterations to the behavior of a template. A trading algorithm consists of 4 essential parts:
- Your Entry - based on what logic are you going to enter the markets
- Your Exit - based on what logic are you going to exit the markets
- Money Management - when entering or exiting the markets, with how many units will we do so
- Risk Management - how will we manage our risk during trading
Each template can have multiple parameters that can be adjusted.
WHAT IS A TEMPLATE?
At Quantler, we work with templates for creating new trading algorithms. A template is basically a container, containing logic, parameters and a notebook on how the template works (what is the templates rationale). You can create these templates online or offline by programming in C#.
BACKTESTING AN ALGORITHM
After creating your algorithm to the way you want it to be, you are ready to run it through the Quantlers backtester in order to test how it would have performed historically. The results of the backtest will provide you with a lot of important information to help you evaluate your trading algorithm. These include a wide array of statistical results such as PnL, ROI, Volatility, Win/loose ratios and many more (see illustration below).
While historical results are no guarantee for future results, backtesting a strategy is still very useful as it helps you ensure that there are no unforeseen errors or glitches in your trading algorithm. Only algorithms that are backtested can be turned on for live execution. Testing your algorithm on multiple data samples ensures that you have a better overview on how rigid you trading algorithm really is.
Quantler lets you compare results between backtest so you can see the impact of any changes made. You can backtest your algorithm on pre-aggregated data for increased speed, or tick data to add more realism. You can also include slippage, additional spreads and commissions, in order to incorporate different cost scenarios.
Once you are happy with the results, we recommend that you forward-test your algorithm by running it on a demo account for a few days to see how it actually performs.
DEPLOYING AN ALGORITHM
When you are satisfied that your algorithm has been edited and tweaked to perfection on the back of the backtesting results, you can now activate your algorithm and host it at Quantler. Unless you are an experienced trader, we recommend that you do this in a demo account (paper trading) first.
Activating an algorithm could not be easier as you just click the “Start Live Trading” button.
Quantler is compatible with any Metatrader broker. Currently over 250 brokers are compatible with Quantler.
On the live trading management window, you can start, stop and remove your trading algorithms when needed. Any orders done manually at your broker will be synced with Quantler, allowing you to always manually intervene when needed.