The Online Investing AI Blog

Here at Online Investing AI, we are dedicated to using new technology to develop Automated Trading systems. But there is one small problem with a purely programming approach. It does not allow us to leverage off the best trading strategies that people have already developed. That’s where you come in.

Are you a successful trader? Are you looking for ways of using new technology and Artificial Intelligence to improve your trading strategies? If the answer is yes, then we are looking for you.

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After reading about 25 books on investing, trading and automated trading, I finally came up with an investment system. Hopefully it will help crystallize your own investment philosophy.

Although there is an unlimited amount of information available about investing, it is a real challenge to find the good stuff. What is the good stuff, anyway? I think “good” information about investing (and in general) has the following characteristics: Read more…

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I’m not really a soccer fan.

But I do get caught up in the World Cup. Most of the teams I rooted for are out.  Even Ghana.

Initially, I had trouble sitting through the early matches. First, the scores were so low. Then the constant racket of those infernal Vuvuzela horns. It sounded like locust on crack.

Sheesh.

But, you know what? After a few games, I don’t even notice.

I think there’s a lesson. This could help you with the personal finance vuvuzelas: the financial media.

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Automated Trading, Internet, Investing, Money, Online Investing AI, Success advice, finance, noise, personal financial, personal financial freedom, soccer, vuvuzela, world cup

One of the goals of our company is to allow anyone to retire within a few years, instead of wasting away in a terrible job for 40 years. Yet that begs an interesting question,.

What would you do with all your time?

Each person gets to answer that for themselves. Perhaps they could peruse their artistic dreams, like the Morphs.

Well, maybe this sort of art is not such a great idea…but the video is so funny I had to share it with you!

Automated Trading, Dreams Come True, Investing, Online Investing AI arts, comedy, fun, funny, morphs, performance, retirement, video

I just finished reading Automatic Quantum Computer Programming and it really got me thinking about the possibilities and promise of quantum computers. For those unawares, quantum computers have the potential to revolutionize our lives as much as the digital computer has. Why? Because they can solve problems that digital computers cannot solve.

How do they do it?

Quantum computers use the characteristics built into the quantum world such as superposition and entanglement to solve these difficult problems. In an ol’ skool digital computer, each bit can only have a value of 0 or 1. However, in a quantum computer, a single quantum bit can have a value of both 0 and 1, at the same time. This is stored as a probability of being a 0 or a 1. So, while the computer that you are reading this on can only store one piece of information in a single bit, a quantum computer can store much more information in a single quantum bit. This powerful ability is known as superposition.

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Whether it’s under the guise of high frequency trading or algorithmic trading or quant trading, advanced technology is becoming more accepted and implemented.

This technology includes artificial intelligence and machine learning.

There’s a good chance it’s trading at least a portion of your money right now.

Is this a good thing? Yes.

Is this a bad thing? Yes.

Could it be bad and good all at the same time? You bet.

The most important thing is be prepared for this revolution in finance. Here are a few ways to be prepared for artificial intelligence in finance.

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After reading dozens of books about human trading and Automated Trading, I feel like one of the biggest shortcomings of trading books is that the strategies are not very well tested. Although each author seems to swear by their systems and indicators, they rarely present any real evidence that their systems work. They do present charts that are handpicked to show when their system worked, but they conveniently ignore any evidence when they don’t work. And, they rarely show a track record of trades so we have an idea of how often it might work in actual trading.

I agree with the authors of Empire of Debt, when they say that trading the markets is not a science, and not even an art. I wonder if it might just be voodoo, where nobody bothers to really find out how successful trading systems are. But that is a topic for another post.

Why am I starting this post about the problems with books about trading? Because The Little Book That Beats the Market is a pretty good exception. Not only does it avoid many of the tricks used by most trading books, the author even explains 7 common faults with trading systems, and how his system has avoided these faults. I found this a singular and refreshing explanation of the rigor of  the methodology used in trading books.

How does he do it?

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The market runs on information. Whether you’re interested in trading on your own, but especially if you’re considering creating your automated trading systems, you’ll need access to financial data.

Thanks to the internet, there are a range of places to find data on traded instruments–everything from stocks to commodities, and everything in between.

A number of financial data sources require payments. Those payments can be pretty expensive. If you’re an individual, or a start-up algorithmic trading company, the fees to access financial data can be prohibitive.

If you need more robust data solutions, you can still find more affordable financial data services to suit your trading style–whether you just want to keep an eye on your own significant portfolio, or you want to start the next big hedge fund.

Here is a list of websites that provide free and affordable sources of financial data.

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pic from artemuestra @ Flickr

It’s now drifted into stock market legend, so we’ll probably never know the truth, but here’s the story: Last week, the market suddenly and inexplicably imploded.

It was already a bad day on Wall Street. The Dow was down a couple hundred points on May 7. Without warning, though, the market plummeted nearly 1,000 points.

The reason for the fall–or perhaps the excuse–was that a trader wrote an order to sell a “billion” shares, instead of a “million” shares. The massive loss was the difference between a “b” and a “m.”
Before we get too snide about this bad-typing trader, it’s important to remember we’ve all made financial mistakes that turned into an avalanche.

I know I have.

There’s the mislaid bill that I swore I paid. It turned into late fees and higher interest. While it wasn’t exactly lead to a stock market sell-off, the lingering effect of those high payments lasted for years and cost me hundreds. I picked up a couple of hot stock tips that blew cold while I wasn’t watching.

So, how do you avoid the financial mistake avalanche?

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I first connected with Nick at Becoming Capitalist through this blog. When I read his intro, I liked the way Nick thought. He sees artificial intelligence and automated-algorithmic trading as a way to tap technology for personal financial freedom. We call that the Wealth Singularity. I’ve been reading Nick’s blog and communicating via email. I’m pretty impressed and thought you might want to see an Expert Profile on what Nick is up to and how he approaches automated trading.

What attracted you to automated or algorithmic trading? Why is this so important to you?

The attraction for me to automated trading was driven by the same desires I had getting into IT and software development. When I see a problem or a set of work, I look for ways to automate it and streamline it. And then of course I have a computer do it. This really provides endless satisfaction. Those who build or create anything understand the feeling of joy when there creation is finally complete.

For the programmer, this joy can be ongoing. Unlike a machine, once you’ve coded something it will execute perfectly again and again; never again requiring your input. I suppose the objective in trading then is for your AI to become a version of you without your bad qualities. No emotion, never tires, hungers, or needs a break, and can multi-task in ways you could only dream of.

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