Alpha Novae

A Blog Post

10 reasons to start trading with AlphaTrader 2

 

alphatrader

One of the most frequent question we are asked is of course “in what your platform, AlphaTrader, is different from the ones already out here”.

AlphaTrader is of course different… It had to be different. It was the very reason of its creation. It was made in the only goal to solve the issues and limitations we had from what has been around for years.

We have been automating strategies for years, with “nearly” all existing platforms. “Nearly” because it is humanly impossible to try them all. More than the thousand of strategies, working with hundreds of different traders, from the individual traders to the asset managers, the hedge fund managers and investment bank traders. So believe me, we have been experiencing in great details all the good, the bad, and the ugly of what is around here. Technologically speaking first, and business speaking trading with broker dealers, ECNs/STP and exchanges DMA.

We had to create this platform to raise the quality of service we provide to our clients. Platform providers are now too much focusing on brokers, their true clients, or on retail beginer traders. Since the very first day, Alpha Novae has been focusing on Buy Side traders and AlphaTrader will not make any exceptions. And with these years of experience working closely with our clients, we had tu put this knowledge in a practical platform raising the standards of trading. We want to bring trading algorithms to Buy Side traders!

Let me give you 10 reasons to trade with AlphaTrader!

1- Reduce your transaction costs

2- Control and improve your execution

3- Be able to hedge and work in a Trade Centric environment with any FIFO broker/exchange.

4- Easily assist your one click manual trading with algorithms.

5- Semi-Automated trading is buit in the platform.

6- Platform specialized in automated trading.

7- Precisely monitor and manage your operational and financial risk.

8- Develop, protect or share your own algorithms and modules.

9- Ask and get what you need…

10- Invest in a new and innovative platform that will disrupt the existing standards.

1 – Reduce your transaction costs.

Cf our article “How AlphaTrader can reduce your transaction costs“.

 

2 – Control and improve your execution.

We could resume our main objective with “WYSIWYG”. What You See Is What You Get. The prices you see are the one you can trade. These are the basis of a good execution.

AlphaTrader allows optimal executions thanks to :

– a low latency access. The need for speed is not about gaming other participants. Before all, speed is important… to get what you see.
– a level II data feed access, available visually but also to tactics and strategies, in order to be able to take into account liquidity concepts in algorithms
– the ability to write or use tailor made execution algorithms (‘tactics’),  available to both automated and manual trader.
– DMA access with no last last look, neither dealer manipulations. At Alpha Novae, we believeour client should stop feeding the Broker/Liquidity Provider ecosystem at their expenses.

An optimal execution can also been measure in term of execution cost. See reason 1 above regarding this topic.

Level II Datafeed

AlphaTrader 2.0 orderbook

3 – Be able to hedge and work in a Trade Centric environment with any FIFO broker/exchange.

(currently with the LMAX Exchange)

A clear distinction is made between FIFO Position Centric platforms where hedging (being long and short) on the same instrument is not possible, and non FIFO Trade Centric platform where it is possible to have different long/short trades on the same instrument with different stop loss and take profit.

From experience we know that traders have their habits and their way to think the algorithms.  it is difficult to think in a Position centric way when you have been working for years in a Trade centric way. But is not only about habits and being lazy to change… Let’s take the example of several strategies running in parallel for example on the LMAX Exchange.

How can we have two strategies being long for one with a specific stop loss and take profit, and short for the other with different associated stop loss and take profit? In a FIFO position centric environment it is not possible. You are flat you can not associate stop loss or take profits to a flat position.

Same problem if your strategy A is long 2 lots and Strategy B is short 1 lot. Your net position is long 1 lot and you can not associate to this short trade a specific stop loss or take profit.

The advantage of Trade Centric platform is to allow this kind of “hedging” and consequently all kind or combinations of trading strategies… while the advantage of Position Centric platform is to net positions and consequently reduciethe financing costs (cf overnight/financing costs above on reason 1).

AlphaTrader is proud to be a platform allowing both Trade Centric and Position Centric trading. Thanks to its Virtual Order Manager layer AlphaTrader can even emulate a Trade Centric environment with a FIFO venue such as the LMAX Exchange, allowing you to have the advantage of the position centric trading (smaller fees thanks to position netting) keeping the liberty of hedging in a Trade Centric environment.

As a consequence, any trading algorithms from any platform can be translated and imported into AlphaTrader.

Trade Centric Blotter
blotter AlphaTrader

4 – Easily assist your one click manual trading with algorithms.

At Alpha Novae, despite being trading automation experts, we understand that not everyone wants to trade fully automated. A lot of traders find their alpha, their edge, thanks to human driven trading. Discretionary trading or manual systematic trading with human validation.

To make manual trading easier, we created different one click order entry panels:

– one click order from charts
– the trade scalper, to work on trade centric environment or with tactics (for tactics see below)
– the position scalper
– the order book

Your trading strategy is certainly the basis of your success. But in today market, where volatility and speed are everywhere, computer assistance is also the key to survival and success.  We aim to associate your experience as a trader to the speed and power of the algorithms. To quote Sun Tzu in the Art of War: “Strategy without tactics is the slowest route to victory.”

So in addition to the classical concepts of indicators or trading automates, we created the concept of tactics. Tactic are algorithms related to a specific trade or trading action, and can be automatically attached to all your trades, whatever if they are entered manually by the Trade Scalper or by strategy. They can be entry execution algorithms, or exit strategies. You choose to take an order, and the tactics will assist you to enter or exit the markets in the best possible conditions.

Tactics are loaded from AlphaTrader AlgoBox and can be out of the box or tailor made on demand (cf reason 9 below).

Above, on reason 1, we already discussed about the “Sniping” tactic or the Spread reduction ones. We could also evocate the pegging, layering or fragmentation algorithms, different kind of trailing stops, etc.

Efficient tactics are the key of your strategies success!

Trade Scalper with Tactic module attached

trade scalper AlphaTrader

Chart

 

5 – Semi-Automated trading is buit in the platform.

In addition of Automated Trading and Manual Trading, AlphaTrader proposes a Semi-Automated mode. You can develop strategies (automates) that will not send orders directly to the venue for execution. The orders generated will be visible on the Approval Blotter screen waiting for either cancellation or approval. If approved the order will be directly sent to the exchange.

The Semi-Automated trade workflow is fully integrated to the platform and does not require custom hacks. On a trade object, the Send() function will send to the venue for execution while SendtoApproval() will send the trade to the Approval blotter waiting for validation or cancellation.

This feature could be extended in the future to restrict access to members of your staff that could only propose trades while the accredited trader would validate or reject them.

6 – Platform specialized in automated trading

This platform have been built before all for automated/algorithmic trading. We created the module called AlgoNaute to make automated trading efficient and practical to monitor and support.

By default, strategies does not run on a chart in order not to waste important processing and memory power in ‘useless’ chart handling. However, in one click, it is possible to open the associated chart window of a strategy, that will automatically contain the indicators used and the strategy trades. Useful if you need to monitor the behavior of the strategy. It is also possible not to display indicators on a chart if you want to keep them private and confidential.

In one click it is also possible to start or pause each strategy individually, and associated PnL are directly visible.

Each strategy has associated dashboard that can be opened in one click and allowing you to monitor the strategy trades (pending and opened), position and its specific logs. The logs of each strategy are not mixed up on a central log to ease the process of monitoring and issues investigation. Each logs can be view through the platform or directly in a file saved on the disk.

Strategies can be restarted automatically at AlphaTrader start up, so if for any reason AlphaTrader is stopped and restarted you will not loose your current set up. Trading will resume as soon as AlphaTrader is back up. Your presence is not mandatory to realise a restart and resume automated trading.

AlgoNaute

AlgoNaute 2.0

AlphaTrader classifies algorithms in three categories:
– indicators. Mathematical computation that can be drawn on charts. for example: ATR, RSI, Bollinger, etc.
– tactics. Specific of AlphaTrader. Algorithms attached to a specific trade or a trade action. For example: Sniping, Layering, Pegging, Trailing Stop, Fragmentation, etc. When a trade dies, the tactics associated to this trade are deleted.
– strategies. Classical trading automates that can use indicators and tactics on trades.

It is possible to programm any kind of strategies in AlphaTrader because you can run them either in Trade Centric mode (like MT4 for exemple) or Position Centric mode (like MultiCharts for exemple).

AlphaTrader allows you to work with a standard and recognized professional development environment: Visual Studio 2010 C#. It is possible consequently to develop your own indicators, tactics, strategies or extra modules using Visual Studio Express 2010 edition.

7 – Precisely monitor and manage your operational and financial risk.

All is not just about speed, only. Speed without controls, monitoring, in a few words speed without stability is the best way to disappear from the markets.

Working as a circuit breaker, if enabled, AlphaTrader Risk Manager module allows you to precisely check your position and execution size, your execution frequency and your potential exposition including pending orders in order to avoid classical fat finger errors or algorithms running wild. In a few words, the Risk Manager could have saved 440 m$ to Knight Capital

AlphaTrader Risk Manager can also acts like your guardian angel setting up a maximum daily loss or profit limit. it is also possible to trigger a trailing limit after a certain level of positive profit. Once the limit is reached, positions and trades are closed and the trading is disabled.

RiskManager

AlphaTrader can also of course send you emails and communicate logs on your own FTP. Ultimately, any kind of alerting system can be added directly in the code of your strategies.

8 – Develop, protect or share your own algorithms and modules.

AlphaTrader allows you to work with a standard and recognized professional development environment: Visual Studio 2010 C#. It is possible consequently to develop your own indicators, tactics, strategies or extra modules using Visual Studio Express 2010 edition.

The results are compiled into DLL that can be encrypted to protect your Intellectual Property rights.

And nothing prevents you to share them with the community when done! It is as simple as dropping a DLL in the AlgoBox folder.

9 – Ask and get what you need…

Before all, contrary to most of platform providers, from the beginning, we are true tailor made service providers to Buy Side traders. This has always been the core of our business, our values.

So if you have specific needs, our team of specialist is the best contact for help.

It can be about automating your strategies, developing a tactic or writing an indicator.
Or it can be about adding functionalities to the platform. AlphaTrader will evolve for you.

Free email quote for indicators, strategies or tactics here.
Hedge Fund Start Up consulting here.

Or just directly contact us by email at infos@alphanovae.com

10 – Invest in a new and innovative platform that will disrupt the existing standards.


AlphaTrader project was started because of the absence of accessible serious tools and platforms allowing us to propose a true professional environment to our clients. Cloning what already exists has no interest for us. With AlphaTrader, we aim to package together the best of the different platforms, associated to our in house innovations.

Our focus is not the marketting for the crowds, but serving the Buy Side traders giving them access to institutional yet accessible tools. We want to bring trading algorithms to Buy Side traders!

A bit of history:

AlphaTrader 1.0 was an Alpha Novae side project started in 2011 to answer some very specific client needs. AlphaTrader has been one of the first platform connected to the LMAX Exchange.

AlphaTrader 2.0 launched in mid 2013 is a complete redesign of the platform focusing on live trading: manual, semi automated or fully automated.

In addition of future regular “point” releases, our next main milestone is AlphaTrader 3.0 which will put focus on backtesting and optimization. Some hints of our objectives. We target to take into account order book liquidity in our backtesting to modelize realistic slippages. We will provide also the ability to write your own fitness function to class the results of backtests and optmisations.

AlphaTrader 2.0 is just the beginning of a long road. A lot of work have been done since the very first lines of codes, but much more is waiting to be done.

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