Trading Algorithms for the Masses
What is quantitative trading?
- Quantitative trading is an extremely sophisticated area of finance
- It has four main components:
- Strategy Identification - Finding a strategy, exploiting an edge and deciding on trading frequency
- Strategy Backtesting - Obtaining data, analysing strategy performance and removing biases
- Execution System - Linking to a brokerage, automating the trading and minimizing transaction costs
- Risk Management - Optimal capital allocation, "bet size" criterion and trading psychology