The best Algo trading software is nothing but a tool that can allow the traders be it be retail or others to trade in Forex with better calculation speed, better computer algorithm, ease of access, and many other things that will make the trading easy. Now the question is is it easy to pick the right Algo trading strategy and perfect Algo trading platform without actually knowing the parameters to choose them. No, it is not possible. That is the reason, we thought of giving you a basic primer or the basic guide, which will allow you to choose the trading platform.
Factors that should be considered
The below-mentioned factors provide a detailed analysis of how these factors affect your trading. This will allow you to check whether the tool has the following factor to become a best Algo trading software. So let’s go through one by one.
- Trading Strategies and System
Trading strategies should be your number one factor. The tool should allow you to pick a strategy from the available lists. It should also allow you to find and create a strategy for you. The strategies should include all kinds of trading mechanisms. Some of the trading strategies need manual override and some need automatic operations. Because of this, the system should allow you to have a fully automatic, semi-automatic and manual trading methods.
- Better Graphical Representation
This is very important, as this will enhance the data and their analysis on the screen. For example, you want to analyze the history of one currency pair. Then the system should allow you to change different analysis with different graphical methods like charts, analysis, historical representation, forecast, trading success rate and other important data representation. This is the second factor in selecting best Algo trading software.
Backtesting is nothing but a collection of historical data and simulations of a particular Algorithmic Trading strategy, which will provide info on the tool’s performance. The results will include profit and loss margins. This will help us to understand about the information ratio or the sharp ratio, which will guide us to the risk management system. It includes two kinds of Backtesting. One is event-driven Backtesting and Research-based Backtesting.
- Online and Web-Based Working Design
Every Algo trading needs to have a better web designing with a higher response rate. As timing is important in trading, a fast and responsive web platform will provide better results. This is a must-have feature in best Algo trading software. The web-based software or website might not have all the features of a desktop based software, but it should have almost all necessary features.
- Programming Language
There are hundreds of programming languages based on different architecture. However, most of the modern systems are designed on C, C++, R, Python, Java, MATLAB etc. There is no hard and fast rule that, one program is better than other. However, you can select it based on your preferences and research.
- Complexity and the Cost
The tool should be easier to understand and have a decent graphical user interface. If the cost of the software is affordable with less commission, then it will be considered as best Algo trading software in many terms. The comfort level of the software should be high and it should not include any kind of layered complex structure.
A best Algo trading software is made up of all the above factors. Choosing a right platform might be difficult as different platforms have different features. However, for better results go for conventional software and gradually upgrade yourself to newer software to get most out of your trading.