Hi, I was wondering if anyone with experience working with system developers on their strategies could share some of their thoughts with me. I'm a computer noob - working with formulas and basic macros on Excel is fine, but I don't think I can write what I need without a lot of intensive study. So instead of reinventing a wheel, I spoke to a programming house to see if they can help construct a small ActiveX app that runs through the IB API. it's nothing too fancy - one strat pulls results out of IB market scanner and executes the order (with stop loss) if it meets certain criteria. The other has no automation - basically an app to calculate and display the results of some technical indicators in numerical form on Excel for a list of stock. Maybe a submit button so I can execute the default size through the worksheet itself. For something like this, what is the typical arrangement with the system developer? The guy I spoke to is asking for a commission basis, per trade, which I thought was exorbitant for something as simple as this. I can understand if it's a system that is jointly developed and optimized, but as it is, I'm providing the strat AND more importantly, doing the optimization. But then again I don't know what is the industry norm. Any system developer or those with experience in the field could perhaps provide me with an indication of what is fair for something like this? Any help is much appreciated. Thanks.
No, it is outrageous to ask compensation on a commission basis for software devlopment only. Go to the IB website and look for programmers in the third party solutions section. Also, never give the original code to the developers but a variation you can later change yourself to what you want, otherwise, if you have an edge of some sort it will be wasted.
I've worked in both businesses and again I note that professionals in the software development field don't get the respect that their skills and value deserve. People are constantly declaring they can't find good people but in reality they just won't pay proper value. It is NOT outrageous to work for a commission on a good trading solution. Basically people are free to follow their own path but software developers ( good ones ) should avoid people like you like the plague. You have a bad attitude, and deserve to hire really bad developers ( like recent high school graduates ).
I've worked in both businesses and again I note that professionals in the software development field don't get the respect that their skills and value deserve. People are constantly declaring they can't find good people but in reality they just won't pay proper value. It is NOT outrageous to work for a commission on a good trading solution. Basically people are free to follow their own path but software developers ( good ones ) should avoid people like you like the plague. You have a bad attitude, and deserve to hire really bad developers ( like recent high school graduates ).
No software programmer deserves commission for an idea they did not produce but just got paid to program. Read the OP. I agree about commission if they co-develop the idea. Actually, the best developer I ever hired was a 19-year old student. Now, for the rest of your attack, you should seek professional help...
Does an investor deserve a return on their investment when they invest in an idea? They are simply supplying capital and didn't come up with the idea.
Predictable. Of course the best developer was 19 most stronger more experienced developers would tell you to take a hike. Professional help ? God your immature that is the point in the first place you want to hire a professional but want to pay them like a 19 year old apprentice. Grow up buddy please.
Thanks for all the replies. I'll check out IB's partner program for some quotations, though I suspect for what I require, a college grad is all I really need. This debate / discussion on fixed fee vs commission is interesting though. I can think of a few other strategies I'd like to test and develop in the future, probably with more complicated logic loops, and I'm wondering at what point of contribution do programming consultants move from being a provider of technical expertise to become a partner in the venture? And in such a partnership, do both sides come out with the capital? Investment strategies (or what we like to call "edge" here)? I can't imagine paying the guy who create my company's website a commission for every sale that is conducted through it - a case can be made that, well, without the designer, there will be no website, hence no revenues anyway, but once you start looking at it from that perspective, everything should be commission based. Not the best analogy I know, but for some reason it comes to mind. byteme, I don't understand what you're trying to say. The investor is risking his capital, hence should be entitled to a potential of profit for as long as he choose to risk it. Or I'm reading you wrong ..?
I am a software developer and I would say that it is unreasonable to ask for a per trade commission for implementing a trade system that you have designed yourself. If you were buying a trade system that they had designed and implemented it would be a different matter.
Just playing devil's advocate. If the programmer is not paid for the work then it is equivalent to the programmer investing capital equal to the amount he would have been paid. From that perspective, there isn't a difference between the investor and the programmer. In other words, it's not uncommon for programmers to be paid in equity rather than cash. Being a shareholder then entitles the programmer to a share of the profits, if any. Unless it's something really unique though, you can probably find a programmer who will simply do the work in exchange for cash with no further involvement thereafter.