Automated trading and backtesting
Semi-automated trading
The trader opens the position manually. The closing of the position is automated based on the trader's instructions. Numerous criteria are available: 13 stop order types, trend lines, time-based criteria, technical analysis indicators, ... Programming skills are not required. The trader just needs to parameter according to his needs. In the words of one of our clients "It is phenomenal what your platforms can do." - NR.
In this example a buy order was launched after both indicators gave a buy signal. An hour and a half later the platform closed the position as the sentiment of both indicators became negative. Note that the bottom indicator is based on a different time frame than the other indicator and the main chart. Few other platforms can combine indicators in different time frames.
Tactic orders
Another way to trade semi-automatically or automatically is by using the Tactic orders. Tactic orders interprets the technical indicators and trendlines in the chart and will place an order (confirmation is optional) based on criteria set by the trader. The trader can, for example, instruct 'buy orders only when the majority of my indicators are bullish'. Or, 'buy and short but only if all my indicators are unanimous'.
Sensitivity analysis
After optimizing a strategy it is essential to do a sensitivity analysis. A sensitivity analysis will indicate which of the optimized trading solutions really merits implementation. The solutions which merit implementation are those whose results are the least impacted by variance in the strategy's parameters. These solutions are robust solutions. The platform offers a very powerful sensitivity analysis tool to quickly measure the impact on results due to variance in a strategy's parameters.
In this example a sensitivity analysis is applied to multiple parameters. The red and blue parameters are fairly stable. The green parameter, however, is too sensitive. It's impact on the result is out of proportion. This parameter would require further fine tuning or replacement by another solution.
For example a sensitivity analysis is applied to a single parameter. The red curve shows the evolution of the trading strategy's P&L in function of variations in the stop price level. It indicates that this trading strategy is too sensitive to variations in the stop price. It is not a robust solution. Indeed, the optimum is only a spike and small variations in the stop price leads to a very significant drop in profit.
Automated trading
The platform opens and closes positions based on the trader's strategy. Combinations of stop orders, time filters, trend lines and technical analysis indicators are possible. It is even possible to allocate different weight to different indicators and to combine indicators even if they are in different time frames. Programming skills are not required. The trader just needs to parameter according to his needs.
In this example the trader uses a simple MACD to trigger his orders. In addition he uses a crossing moving average as a filter (red zones indicate bearish sentiment).
Backtesting
The back testing functionality allows traders to quickly and easily test their trading ideas. It is also possible to considerably improve the quality of trading strategies and methodologies ... without the need for programming. The optimization window allows the user to select the objective towards which he wants to optimize his trading strategy or a parameter thereof. There are currently 12 objectives. For example: total maximum profit, total profit/drawdown, maximum number of winning trades...
The theoretical trades of each strategy optimization are shown in the chart. The trades are complete with signal, filter zones and stops. A visual analysis of a trading strategy is much more relevant than a table with numbers.
The cumulative profit chart is a key tool in evaluating a trading strategy. Are the profits due to a few trades only? Are there only profits under particular market conditions? Or, are the profits nicely distributed over the full period? Unique to the platform is that the chart updates in real-time! Change something to your strategy and you immediately see the effect.
The results can be displayed trade by trade or over a period (day, week, ...). In this example the results are cumulated on a weekly basis.
Cloud
Clients can run their platform and automated strategies on our cloud server. A great advantage of the cloud server is that via your tablet you can operate the complete NanoTrader with all its functionalities. Better than a mobile trading platform.