Recently I've noticed that no matter how much I follow a trading plan or set stops that there is always some emotions involved in trading. If someone is a strong believer that a stock should be going up or down for some reason, they will eventually see it in the technicals and be convinced that this is the way the direction should be. The way we trade is constantly influenced by external inputs of data. The human mind is easily influenced by news or other convincing sources of information.
To eliminate emotions from the equation we must eliminate the human from the decision making part of the equation. A machine is completely impartial and uninfluenced by emotional impulse in decision making - not to mention faster than a human in executing a planned trade.
So I have started to brush up on my Java in order to interface with Interactive Brokers' API for trading platform. There are some strategies which I will look to employ on the paper trading account after much back testing. I will publish some of the strategies as I go along.
As a side note, it is interesting to note that most of the traded volume on exchanges are executed by computers as part of algorithmic trading platforms. The NYSE releases weekly program trading statistics, and for the week of October 12-16, program trading accounted for approximately 29% of the average daily 2.5 billion shares traded. (http://www.nyse.com/press/1256207611289.html)
No comments:
Post a Comment