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May 2011 Edito : A real electronic jungle...


One of the first questions that asks a trader when he decides to start automated trading concerns the choice of the platform.  In any case, there are a lot of possibilities : Metatrader 4, Metatrader 5, Multicharts 7, MCFX, ninjatrader 7, Iforex, strategy trader, TradeStation,  AmiBroker, OpenQuant, VisualChart, X_Trader, etc.  At a more professional level, we could add some more such as QuantHouse, Deltix, Bloomberg, etc. I will stop the listing here...

One of the last questions that asks himself every automated trading specialist still concerns … the choice of the platform. After 2 years of daily work consisting in automating trading strategies, I still don’t have a clear-cut opinion. In effects, the more you dig, the more the choice becomes complex.

However, one thing I’m sure now is that this choice cannot be unique. It has to be adapted to each trader expectations and needs.

It depends among others on the choice of the broker(s), the instruments (Forex, Futures, CFD, Actions or Options), on the possibility to backtest, to execute automatically, on the fiability level of the platform, on favouring a simple programation language or a more detailed one, on the capacities of charting, on the importance of a communauty or on an efficient support and of course on the budget to allocate.

As concerned the backtests, is it necessary to have a multi-instruments and multi-timeframe motor?

Is it important to be able to backtest a portofolio? Do you need optimisation algorithms, Monte-Carlo and Walk-forward?

To this platform problematic,  you may add the question of the market data. Real time feed or end of day ? Necessity of historical data or not? What granularity is seeked? Level I data or Level II ? Some platforms offer broker's market data feed directly integrated such as Metatrader, other such as NinjaTrader or Multicharts can be connected to external feed such as Zenfire, PatSystem, IQFeed, KineTick, etc. These flows are of course generally not free but the qualityhas nothing to do with the free datas.

You could also  add the choice of the broker. For listed products such as the Futures or Shares, the choice will mainly depends on the fees and on the quality of execution and support. For the OTC products such as the Forex and the CFDs, criterias are multiple. DMA on a MTF ( as LMAX offers ) ECN/non dealing desk, or Dealer.

If you thought it was not enough complex, you may add again that you can not generally make your choice "à la carte" : platform, data feed and broker. Each broker is not offering every platform or data feed and vice – versa.

You’ll understand now why I don’t clearly answer when the following question is asked on the forum : “Hi, what is the best platform and broker to make automated trading? “

Too often, the trader suffers from the platform choice. The broker or his wallet chooses for him. It’s, on the long term, a mistake, because the platform is your first tool and will strongly influence the kind of strategies you will be able to put in place. How many people suffer from not being able to realize multi – pairs Backtests on MT4 or bemoan the poor quality of historical data without trying to go elsewhere? How many are complaining about not being able to place stop orders at less than 5-7 pips from Bid/Ask rate without looking for an ECN?

That’s why we also offer a consulting service to give you Your best solution.

Nicolas Vitale
Owner of Trading Automatique and Automated Trading
Director of Alpha Novae Limited

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