Automated Trading

Discussion in 'Trading Software' started by goldenarm, May 10, 2006.

  1. tas1130

    tas1130

    Based on the price of the software and what it can do, I would give it a letter grade of C+. In other words a passing grade but it could be a lot better. The software does have great potential but much of that potential remains unrealized.

    For example, the software can only run one long and one short strategy at a time. You would have to pay additional money for another installation of the software to run 2 long strategies at the same time. Compare that to other auto trading software packages like TradeStation or Sierra Chart, where you can run multiple strategies simultaneously from a single installation with no additional costs. The CTP software architecture isn't designed to provide maximum flexibility to the user. Rather it seems to be designed to maximize profits from its users by making you pay more for running several strategies at once. This is one area that sets it apart from other auto traders.

    The CTP software has no back testing capabilities like other auto trading software so you either have to forward test your own strategy (very time consuming) first or rely on an existing strategy that hopefully has a long track record you can verify. As previously pointed out in other posts here and in CTP's own forum, there aren't any publicly documented trade logs of long term performance - say 4 or 5 years that anyone can view who might be interested in the product. You can definitely find people who have been running the CTP software for 6 months or more and you should see some good results but you have to remember that nearly any long strategy should have done well over the last year as we’ve been in roaring bull market. The point is, short term performance of a strategy is likely to mirror the prevailing market condition and can be misleading. This is where back testing (if used properly) can be useful since it can eliminate a lot of bad potential strategies which saves time and money. This is something the product should support – especially for the cost of the software.

    The platform doesn’t support custom indicator and formula creation like other auto trading software. It only supports the use of <, >, =, &#8800; logical operators for indicators but no arithmetic operators such as multiplication and division. Another limitation is that rules can be only combined using a logical AND operator but not with an OR logical operator. This makes the software much less flexible in strategy creation than other packages like TradeStation, Sierra Chart, MultiChart, etc. Indicator and formula customization is a major weakness of the software and addressing this issue should be a high priority in future releases. Also the list of indicators supported is rather limited compared to the other trading platforms previously mentioned. The platform appears to be using 3rd party software provider FMLabs for its indicator suite. It has most of the traditional indicators that you’ can find on many other free websites and in charting software but you find more indicators on other auto trading platforms like TradeStation, Trade Navigator, Sierra Chart, etc. Even the free ThinkOrSwim platform has more indicators and all of these other platforms allow full modification of existing indicator parameters as well as creation of custom indicators. This allows the user complete flexibility in watch list and strategy creation and is an area where CTP could use some improvement.

    Another drawback of the CTP platform is its dependence on the real-time brokerage data feed to supply values for the indicators it supports. Because there’s a limit to the amount of real-time data that the broker supplies. There’s a limit to how far back in time you can use for calculating indicator values. This limit seems to be somewhere around 600 to 700 one minute bars of data. That means for an indicator you could use a 15 minute 40 period moving average (15min. x 30 = 450min.) but not a 30 minute 40 period moving average (30min x 30 = 900min.). This also limits the look back period for intraday and EOD indicators (e,g, a 50 EMA “n” days ago). If you want to use any intraday indicators that use more than a couple of days of historical data you’ll be out of luck. Other auto trading platforms get around this limitation by either using historical data caching or using a data feed other than the broker. This allows much longer periods to be used for intraday and EOD indicators and much longer look back periods and allows more flexible watch list and strategy creation. Historical data caching and/or a better data feed are features that definitely need to be added to the CTP platform.

    Lastly, in addition to the initial cost of $3500 for the software, you’ll have ongoing monthly fees that will kick in 13 months (or 2 years with current promotion) of $125.00 per month after the initial purchase. This isn’t a data fee since the software uses the data feeds from the broker platforms which you would already be paying for from your brokerage account. Other auto trading platforms typically have either a lower one-time fee (or no fee at all) or a monthly fee just for the data which in most cases are usually
    less than the CTP $125.00 per month. So you’re paying for the convenience of getting some default strategies with the platform but that’s about it. Depending on your auto trading requirements and level of trading experience this platform may be suitable. Just be aware there are plenty of network marketers out there who are promoting this software (they receive a referral commission on any sale) saying this is the only software that can auto trade for you which is completely false. Don’t take any network marketer’s word for it and check to see what else is out there that could potentially do the same thing. Even if you can’t (or won’t) program a trading strategy with one of the other auto trading platforms yourself you could hire a programmer to do this for you. Most of the other software platforms already mentioned have people who advertise their services to program in any of the other software programming languages. This could be a more cost effective option and provide better trading results.

    Hopefully Ed and the rest of the development team have recognized some of these missing platform features which other auto traders have and they continue to improve the platform in the coming months. If the software could support back testing, historical data caching for indicators, more logical and arithmetic operators for strategy creation, and full formula & indicator customization like the other auto trading platforms then I'd change my letter grade for this product to an A.
     
    #51     Aug 8, 2013