How to implement Basket Trading?

Discussion in 'Strategy Development' started by ezbentley, Mar 23, 2009.

  1. Does anyone have any insight on how to realistically implement this entry method?

    Buy intraday if a stock penetrates 20-day high. Do this on NASDAQ100(or SP 500) stocks.

    An unrealistic way(just for concept) is just to enter 100 limit orders before the market opens, since the past 20-day high can easily be obtained after the previous close. On any given day, there can be between 0 to 100 signals triggered. I am under the impression that this can be done and there should be some people doing this, especially on equities.

    I am more concerned about how the buying power is taken care of by the broker when the available fund is insufficient to cover all triggered signals.

    If the broker deducts BP when order is entered, then the trader needs to implement some kind of intraday market scanner and to send order only when signal is triggered.

    If the broker deducts BP only after order is executed, this is more trader-friendly since the trader can simply cancel all remaining orders after BP is maxed out.

    If anyone is doing this type of trading, can you share your experience on how this is done? Which brokers provide basket trading features and how do they handle the buying power?

    Thanks in advance,
  2. No one does this type of trading?