Whether you are trying to automate your trading or trading completely manually (without code and presets), you need to know what you want to accomplish.

If you already have a trading account, contact the supplier as they have already helped other traders setup algo-trading on their platform. This tends to be a faster approach then to first code and then try to apply your code to your particular trading platform.

1. Develop a trading strategy: The first step in starting automated trading is to develop a clear and well-defined trading strategy that outlines the specific rules for buying and selling assets. This should include the market or markets you will trade in, the types of securities you will trade, and the specific conditions that will trigger a trade.

2. Choose a trading platform: Next, you will need to choose a trading platform that is capable of implementing your trading strategy and executing trades automatically. There are many different trading platforms available, so it is important to research and compare different options to find the one that best suits your needs.

3. Set up your account: Once you have chosen a trading platform, you will need to set up an account and complete any necessary paperwork or documentation. This may include providing personal and financial information, as well as funding your account with the capital you will use to trade.

4. Connect your brokerage account: In order to execute trades automatically, you will need to connect your brokerage account to your trading platform. This will typically involve providing your brokerage account credentials and authorizing the platform to access your account.

5. Define your parameters: After your account is set up and your brokerage account is connected, you will need to define the specific parameters for your automated trading strategy, such as the types of securities you want to trade, the entry and exit points for trades, and the amount of capital you want to allocate to each trade.

6. Backtest your strategy: Before you start trading, it is important to backtest your strategy to see how it would have performed in the past based on historical data. This will help you assess the potential profitability of your strategy and make any necessary adjustments before you start trading live.

7. Implement your strategy: Once you have backtested your strategy and made any necessary adjustments, you can implement it on your trading platform. This typically involves uploading your trading rules and parameters to the platform, and then activating the automated trading system.

8. Monitor your trades: Even when using automated trading, it is important to monitor your trades and the performance of your strategy. This will allow you to make any necessary adjustments to your strategy or trading parameters in real-time, and to intervene if necessary.

9. Manage your risk: Risk management is an important part of successful automated trading. This involves setting appropriate stop-loss and take-profit levels for your trades, as well as implementing risk management tools such as position sizing and diversification to reduce the overall risk of your portfolio.

10. Review and adjust your strategy: Finally, it is important to regularly review and assess the performance of your automated trading strategy, and to make any necessary adjustments based on your findings. This may involve changing your trading rules, adjusting your parameters, or even completely overhauling your strategy if it is not performing as expected.

Want to give it a try? Vanilla Equity uses Interactive Brokers and they offer Capitalize.ai for all your algo needs. This is a good starting point to get familiar with the algo trading principles.

If you are already familiar with the Python programming language, check out this tutorial.

But wait… do you really want to automate your trading?

Standard trading platforms offer a multitude of programmable order triggers that relieves you from babysitting your stock portfolio. If your intention is to simply program your trading pattern in advance, you might be surprised how far you can get with the available tools of the trading platform of your choice.

But maybe it’s the elusive dream of a money making computer (that executes thousands of small profitable trades daily regardless of trading costs) that you are chasing. In that case you might want to look into the C and C++ programming languages that are more suitable for high frequency trading than Python.

Personally, I always thought that less is more when trading, since transactions are never free (they can be free of charge). Also, the high speed connectivity required for algo trading has price tags both in your end (your server) as well as at your broker’s end (they charge for the connection setup and data transfer).