Tutorial: Code an Algo Trading Strategy Part 1

Ask any professional trader what makes a good trading strategy and they may give you a surprising answer: simplicity. Many traders adhere to the ‘napkin’ rule—can you write the logic of your strategy on the back of a napkin? If not, it’s probably too complex.

We’ve talked to many professional traders like Michael Himmel and Ernie Chan who advocate for simplicity in trading systems. At first it may be intuitive to add more indicators to filter market noise and develop a highly selective strategy. However, the more indicators and more filters added to a strategy, the higher the chance that the strategy you create will be designed not to fit the market but to fit the data. For best results, stick to simplicity when creating the logic for your trading system.

Once you’ve written out the logic of your strategy, you’ll need to test it to see how it performs. Now comes finding a data stream, connecting with an execution engine, programming a GUI, coding the strategy, backtesting the strategy, optimizing the strategy. This can be an intimidating process for a newer trader, or anyone who simply doesn’t have that kind of time.

Enter Trading Station. FXCM’s Trading Station platform takes care of the more time-consuming processes involved with algo trading by already being connected to a pricing stream and an execution engine. All data is displayed inside its user-friendly GUI which includes custom strategy backtesting and optimization tools, so all that’s left to do is coding your strategy’s logic using the Lua programming language and the Indicore SDK.

In this tutorial, you will explore a tool that does 80% of the coding for you. You’ll find out how to take your strategy idea from an idea to a tradable strategy in less than an hour. Then, join us for part 2 to learn more about how to code technical indicators into your strategy. to Click here to get started.


Risk Warning: The FXCM Group does not guarantee accuracy and will not accept liability for any loss or damage which arise directly or indirectly from use of or reliance on information contained within the webinars. The FXCM Group may provide general commentary which is not intended as investment advice and must not be construed as such. FX/CFD trading carries a risk of losses in excess of your deposited funds and may not be suitable for all investors. Please ensure that you fully understand the risks involved.