What about low frequency algorithmic trading? As in you run a program that is looking to make money holding a position for hours to days so the exact buy price isn't as big a deal. Or does it become to much of a game of chance then?
Ask HN: Is it feasible to do high-frequency trading as an individual?
11–20 of 59 posts
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#12Stay away from HFT, big players will eat your lunch. HFT isn't even a game of milliseconds anymore, it's a game of microseconds. You can still do well with algorithmic trading where speed of execution isn't an issue. Work on your strategy, test it on historical data, execute it manually, if it works then automate part or all of it.
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#13What about low frequency algorithmic trading? As in you run a program that is looking to make money holding a position for hours to days so the exact buy price isn't as big a deal. Or does it become to much of a game of chance then?
Trouble is that you still need to guess what kind of market you are in. Such systems often only work in some trending markets and you can easily loose what you have gained when market goes against you.
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#14I can't even get real time (meaning not delayed by 15 minutes) stock quotes for my startup here in Brazil.
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#15You should give up ... reason is that HFT costs for the big houses are just a fraction of what you are paying, like less than a penny per trade. You could not hope to gain back in margin, what you lose in transaction costs.
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#16HFT is a game of speed and low fees. Not a single individuals broker can offer substantial speed (microseconds count) and fees (cents count). It is a game for prime brokers and big institutionals. Moreover it is true that some exchanges (like NYSE) offer lower latencies for a serious monthly fee (not the one an individual can afford). Thus I don't think one person can solve all these complexities, however this topic is a good startup field with lots of ineffeciencies and unsolved problems.
Algorithmic trading is an option, though needs careful research on topics of broker setup (InteractiveBrokers should be a good starting point, ThinkOrSwim is another good one, both has rather tolerant programming APIs) and software for time series analysis and trading (among the most popular are Marketcetera and WealthLab + lots of libraries like Incanter and Weka). On some of these topics http://elitetrader.com forum should be helpful.
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#17[deleted]
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#18A little OT: People here are always talking about trading stocks, anyone dabble in forex?
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#19Someone on reddit a few months back was succesful at this:
"I used to work as a software engineer and started developing and trading automated strategies in my spare time in 2006. I went full time in 2007 and have been profitable every quarter since. AMAA"
http://www.reddit.com/r/IAmA/comments/9s9d7/iama_100_automat...
Re: Ask HN: Is it feasible to do high-frequency trading as an individual?
#20Since everyone has said no so far, I'll go ahead and say it's possible, but very difficult.
HFT algo commission is much lower than $10/trade. IBKR offers 0.008/sh, and it can get much lower if you trade in volume.
Like others said, it is a game of milliseconds. So you need to own a server near the exchanges in new york (i.e. http://www.ubiquityservers.com/data-center/new-york.php).
The best way to start learning is develop algos not for HFT. Instead of milliseconds think about 15 min - daily holds. If you're trading under 25k, you're only allowed to make 3 intraday trades a week.
So find a broker that has a FIX api, buy some data for backtesting, code some stuff out using R/python, and forward test your strat using papertrading for about a month-- then put real money to work.