The Online Investing AI Blog

Expert Profiles gives Automated and Algorithmic trading system developers and theorists a chance to introduce us to their concepts and strategies.

Our expert featured in this edition of Expert Profiles is Jez Liberty.

Jez is extremely passionate about Automated Trading and its technology. We’ve enjoyed Jez’s posts on Automated Trading at his blog, Au.Tra.Sy blog.

Here’s Jez’s interview:

What made you choose to develop Automated Trading systems?

I have a long-held fascination with the trading world and a passion for technology. So automated/mechanical trading system sits at an ideal crossroads for me and represents an exciting topic to work on.

Additionally the prospect of going into a corporate career never appealed to me; whereas automated trading systems can give you independence and more freedom (and hopefully better wealth).

What are the challenges of developing Automated Trading systems?

There are lot of information out there and it can be hard to know what to pick to get started. In my case, I started trying to automate Technical Analysis patterns with “brute force” backtesting/optimization, which did not prove successful (I am skeptical on the long-term profitability of that approach). Further down the line, I stepped back and got more interested in learning about the nature of the markets, statistics and money management. This led me to have a clear vision of how I could succeed in trading automated systems.

But developing and trading an automated trading system is also a long process, far from the get-rich-quick scheme, that many dubious salesmen would have you believe. So you have to put in some hard work. But the reward and payoff are definitely worth it!

Working on your own can also make you feel isolated. However, my blog and other blogs such as Online Investing are a great way to engage and collaborate with like-minded people.

Read more…

Accelerating Technology, Automated Trading, Investing, Money, Online Investing AI Automated Trading, automated trading experts, automated trading systems, computer, expert profile, experts, McDonald's, trade, wealth

BeauB@Flickr

Yesterday, we talked about social proof as one program that hinders your success as a trader. Social proof is the tendency to rely on others to validate one’s actions.

But there are other programs that can cause you to lose at trading and investing. One of the most common is greed: an unrelenting desire for more.

I know what you’re thinking: But isn’t everyone in the market seeking more money? When you make a trade, aren’t you trying to make more money?

Isn’t greed good for traders?

Actually, greed is based more on the feeling of lack and limitation. We have to make a distinction between a healthy attitude toward abundance and a blinding greed that becomes fixated on losing positions.

Greed serves as blinders for investors.

Here’s a scenario:

Read more…

Business Strategy, Investing, Money, Online Investing AI failure, greed, lose, losing, programs, Success, trade, trading

L.Marie@Flickr

As the maker of Automated Trading financial systems, we offer a few reasons why computer-based trading can help investors. They operate continually. They edit out emotions. And, they can be programmed for success.

When it comes to trading, it seems that most humans are programmed to lose.

This week, we’ll take a look at the ways you and I can be programmed to lose, especially when it comes to trading decisions.

In today’s post, we’ll take a look at social proof, a psychological theory, that may exert a powerful influence on unsuccessful trading strategies. Social proof is nothing more than “follow the leader,” except, in this case, no one knows who the leader is. And no one knows why the leader is the leader.

Here’s how it works.

Read more…

Automated Trading, Investing, Money, Online Investing AI, Success lose, market, Money, programs, stock market, stocks, trade

The pictures of the Singularity include some unflattering visions of humanity:

Large gelatinous shapes, reaching for Cheetos with one flipper and resting the other flipper on the remote for the three-dimensional virtual reality environment. Meanwhile, an Automated Trading system will earn money for this creature.

This is silly. Cheetos will cease to function as a snack food during the Technological Singularity.

OK. Seriously.

There are some trader who look at Automated Trading as the lazy way out. They, after all, enjoy trading and don’t think a machine can trade for them.

Fair enough.

If Automated Trading isn’t a servant for a trader, it can be a boon companion.

Read more…

Accelerating Technology, Automated Trading, Investing, Money, Online Investing AI Automated Trading, fat, Investing, Money, singularity, snack foods, trade, trading, wealth

Creative Commons Photo by Stefan: Daikokuten is one of the Seven Gods of Fortune. He is the god of wealth, commerce and trade (hence the bales of rice under his feet).

Most of the environmental movement is built on the theory, that the richer we get, the dirtier the world gets. At first glance, it seems to be logical. The more money we make, the more things we consume, and the more energy we use.

In fact, ecologist Paul Ehrlich and the physicist John P. Holdren (President Obama’s science adviser) came up with a whole new equation to sum up this “money is the root of all environmental evil” theory. It basically says, environmental impact=Population X Affluence X Technology (I=PAT).

But John Tierney, who wrote a piece for the New York Times, says this is based on flawed logic. He adds that common sense and a steady stream of data from the 1970s (when the I=PAT theory was first formed) reveal this flaw.

Read more…

Accelerating Technology, Investing, Money, Online Investing AI, Success, US Economy carbon, commerce, environment, laws, Money, trade, wealth

Visualizing your shots--investment and otherwise--can improve your chances of success.

A group of basketball players were separated into three teams.

Team A practiced taking shots on the court and practiced visualization exercises.

Team B just practiced visualization exercises, seeing their well-tossed ball swish through the hoop.

Team C didn’t do a thing. Just hung out in the locker room and ate pizza, probably. (Man, I wish I was picked for team!)

Then researchers made them take shots out on the court, recording the number of baskets they made.

Needless to say, Team C didn’t exactly light up the boards. In fact, they kind of stunk. And, as you probably guessed, Team A made the most shots.

You would probably guess that Team B did about the same as Team C. I mean, they just sat around and day-dreamed, right?

Not so. Team B almost did as good as Team A. This research suggests that visualizing your goals is a real performance enhancer.

What does this mean for your investing and trading?

Read more…

Dreams Come True, Investing, Money creative visualization, investment, trade, trading, visualize, wealth

A good portion of independent investors are drawn to trading and the market, in general, because they enjoy it. It’s a hobby for many.

But, a vast group of potential investors are left on the doorstep of financial freedom because they believe that it takes special skills and a whole lot of time and effort to become a “trader.” They may invest in a few stocks, but rumors that they will be forced to spend hours locked away with a copy of Value Line and research earnings reports keeps them from actively trading and investing.

With a full-time job and family commitments, time is a commodity they can’t trade.

So, they need someone else to mind their money, they decide.

The financial industry reinforces this stereotype, making it clear that only financial analysts with 120-hour work weeks can understand the market.

But is this true?

Read more…

Accelerating Technology, Automated Trading, Investing, Money, Online Investing AI financial industry, financial wizards, investment, investors, Money, technology, trade, traders, trading

Thomas Jefferson said that every generation needs a revolution.

A generation of traders, who are currently fighting a battle of unfair fees and poor returns, will lead this generation’s financial revolution. A generation of independent investors who are tired of financial advisers who offer bad advice for a great deal of money will be in the trenches, too. A whole new generation of folks who want to have the improved returns of trading, but don’t have the time for research and maintenance may also serve in this revolutionary army.

This group of tech-savvy investing and trading revolutionaries may now consider Automated Trading systems a more viable option and are pushing this new financial technology to its tipping point.

If you’re considering creating an Automated Trading account, we’ll cover three ways to prepare an Automated Trading portfolio this week.

Over the next three days, we’ll discuss three steps you can take to prepare yourself for the Automated Trading revolution.

Here’s what we’ll be looking at:

Read more…

Automated Trading, Business Strategy, Internet, Online Investing AI, Success Automated Trading, forex, Money, stocks, trade, trading, wealth

While everyone can be a candidate for Automated Trading, some traders make better candidates than others.

Automated Trading is simply a way for a trader to securely trade your account for you.

If you’re interested in Automated Trading, or are new to the concept, you can use the following criteria to determine whether this trading technology makes sense for you.

You have risk tolerance. Automated Trading has its risks, too, so don’t bet the milk money, or Lactaid money for those who have a high risk tolerance but low lactose intolerance.

You have about $5,000. Most Automated Trading systems require more frequent trading. If you don’t have a sizable portion of money, your return will be eaten away by commissions.

You don’t want to spend all day watching the market. Automated Trading is like letting someone else monitor the market for you.

You don’t want to spend all night researching. Trading stocks can require a lot of study and research time, depending on how you trade. Automated Trading does all this, especially systems that use technology to study positions.

You want to hedge your own trading moves. Some folks just like to trade. There’s nothing wrong with that. But, there are traders who choose an Automated Trading system–or systems–to trade a portion of their account. It acts as a hedge and improves the odds of success for their total return.

You want to make better than average returns. If you choose correctly, Automated Trading systems can unlock the same type of high returns without the massive time of work and research that most traders put in to examine their positions.

If you can agree with these six principles, chances are Automated Trading is a good fit.

To learn more, check out Online Trading AI.

Accelerating Technology, Automated Trading, Investing, Money, Online Investing AI, Success Automated Trading, invest, Investing, Money, returns, trade, traders, trading

Automated trading, or autotrading, is a stock or asset trading technology that allows one trader to automatically execute trades for another trader or group of traders.

At its best, automated trading or autotrading allows you to mimic the high-return positions of successful traders.

Certain traders are better suited for autotrading systems.

• Rookies. Traders who want to learn how to trade and want the high-return potential often use an automated trading system to earn money as they learn the ropes.
• Busy people. Some people want to trade, but are too busy with their own professions. Human-based trading requires long hours of study and patience as the trader watches market moves.
• The ripped-off. Many investors who tire of the low-return rates and high fees of their mutual fund investments want a way to lower their cost to invest, but increase their potential for returns.
• Entrepreneurial. To many investors, automated trading is just a new way to earn passive income.  These entrepreneurs accept autotrading as the future of trading.
• Trading hedgers. Traders can use automated trading systems to hedge their own positions, or take part in other markets where they lack time or knowledge.

The key thing to remember is that successful traders aren’t perfect and even automated trading systems rely on imperfect models. Other automated trading models based on static models also fail regularly, as the markets they typically thrive in turn sour.

Online Investing AI will use advanced artificial intelligence technology to generate automated trading calls. The systems were designed not to be encumbered by human greed or fear; nor are they static systems that no longer work when market conditions change.

This allows all the benefits of autotrading, but addresses the need for consistent, low-risk, high returns.

In the future, we’ll look at best practices, how-to’s, and important resources if you’re considering autotrading to augment your investment strategy. If you would like to sign up to be alerted when Online Investing AI has trading strategies available through autotrading, just sign up for our newletter.

Accelerating Technology, Investing, Money, Online Investing AI Automated Trading, autotrading auto trading, C2, hedge, trade, trading