Is a trading bot worth the time?
- Thread starter sane120
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D
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I've built crypto trading bots from scratch in Python and if you want to have anything to do with HFT, arb, market making etc then C++ is the only real option to be competitive on a large scale (plus server locations, and a seriously good understanding of how to optimise for reduced latency).
For anything like autonomous day trading, swing trading, scalping (for the most part), mean rev, you'll be fine with Python or similar.
Building a backtesting engine easily takes up most of the time if you choose to build it custom instead of using a pre-build engine. It's worth building it custom though because you get a more intimate understanding of it, more flexibility.
If you don't have a REALLY solid understanding of trading principles then you need to start scouring r/algotrading, in fact do that anyway because you'll learn a good amount. If you can already code to a decent degree and are confident you can build something like this, then put most of your focus in learning about technical analysis.. like 75% of your time. If you don't get TA you'll just waste your time building a bot that does shit.
Most of the people I've worked with that were really killing it have academic backgrounds in machine learning, stats, high level math. It's not to say you can't make good money with crypto bots, but they have a serious upper-hand.
I worked with an Asian chick who interned at one of the largest hedge funds in the US. It was an eye-opening experience to say the least.
For anything like autonomous day trading, swing trading, scalping (for the most part), mean rev, you'll be fine with Python or similar.
Building a backtesting engine easily takes up most of the time if you choose to build it custom instead of using a pre-build engine. It's worth building it custom though because you get a more intimate understanding of it, more flexibility.
If you don't have a REALLY solid understanding of trading principles then you need to start scouring r/algotrading, in fact do that anyway because you'll learn a good amount. If you can already code to a decent degree and are confident you can build something like this, then put most of your focus in learning about technical analysis.. like 75% of your time. If you don't get TA you'll just waste your time building a bot that does shit.
Most of the people I've worked with that were really killing it have academic backgrounds in machine learning, stats, high level math. It's not to say you can't make good money with crypto bots, but they have a serious upper-hand.
I worked with an Asian chick who interned at one of the largest hedge funds in the US. It was an eye-opening experience to say the least.
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sane120
Regular Member
- Oct 4, 2013
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Yea actually I don't have experiance with reading the chart i know some basics tho, but my friend does know and actually he is the one who told me about that , he managed to make 2k$ in one month with 1btc using his bot , but im working on another projects too and im not sure if he made those money because the market is getting better or maybe by luck lol since he has been using the bot for only one month. Also I don't wanna waste my time so thats why im asking about people experince with it
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D
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90% likely because he was trading during uptrend and caught that, not because the bot is generalisably profitable in all conditions.
Saying that, 1.20% ROI/month is possible with certain algos, but a "normal" dev isn't going to be able to implement them in a reliable way (not sure of your friend's level of knowledge but guessing he doesn't have a background in financial mathematics).
sane120
Regular Member
- Oct 4, 2013
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No he doesn't but he knows how to read the chart, when to buy and sell, and yes im thinking that he made the money becsuse of the uptrend but didnt want to underestimate his work, but the weird part that is the bot has made profits 28 days and lost only in 2 days
clark123
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- Feb 27, 2012
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i think there is few powerful bot already right? like gunbot and another similar one but more customizable.
Crypto is out of my league lately I am playing with forex custom indicator for day swing trading.... lets see how it goes, so far its negavie lol
Crypto is out of my league lately I am playing with forex custom indicator for day swing trading.... lets see how it goes, so far its negavie lol
clark123
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- Feb 27, 2012
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Can do backtesting with years of data to over come it.
YujinTan
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for what I know those traders know the basic how to see chart, etc if they wanna go auto so call using bot they will tell the developer , programmer like when the bot activated the trade when reach certain target area etc trading stuffs principals etc
but these traders more prefer to manual trade than using Bot. To them manual trade means depend how the market go , Bot just activate the trade is base on " certain rules " so thats the differece.
Everyone knows you can't win every single trades, but as long earn profits that the aim.
YujinTan
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Means the bot work great as long earn profits but the bot is it he bought one or ownself program etc? since you claim he don't know how to read chart surely is buy or subscript for it
I do know one cryptocurrency bot , it seem not bad literally is you subscript for it , let the bot do the trade for u
sane120
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- Oct 4, 2013
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He made it by him self, yes the bot has made profits but during an uptrend so you can say that the bot is good or not at least for now, I don't buy bots from others because no one would sell a bot if its making him enough money
YujinTan
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Hmm quite interesting or your friend "bluff" you ? For what I experience so far come from those people having their " own bot " so call ask programmer to fine tweak it beside they roughly know how to do it themselves Does will at least know how to see the chart, or else how he can program himself tell the bot when activate the trade, what rules to apply just like he watch the chart manually , does the market currently those pip movement is telling him a buy or sell like that
Well you are wrong , People always Greedy for more, Those having bot making him enough money also sell it or provide Pay subscription
that means not just he earn himself he also earn from the bot service he sell to others.
YujinTan
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maybe his friend. "bluff" him ,Is obviously kinda ??? since he claim he knows his friend don't know how to see chart , yet the bot can profit claim he do himself??? how that possible if u don't know how to see the trading chart , how u going to instruct tel the bot when to trade ?
Unless he either buy or subscript people bot .
D
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depends on which 30 days. If the algo favours uptrends and there were a month's worth of uptrends then 2 + 2 = 4.
No you backtest historically, over a long enough period of time you'll be able to test the performance of an algo in all conditions. The most common problem when creating algos is overfitting (the issue that OP's friend is probably having).
Shit looks good because your algo is suited to only a limited range of circumstances, but in a generalised way, it could be massively unprofitable to run the algo.
Yep.
..is shit. Any bot that hundreds/thousands of people are using is not worth bothering with.. maybe 1% of all mass-used bots would be reliably profitable longterm. It's a zero-sum situation when lots of people are all trying to implement the same strategies in the same way.
Algorithmically, yeah. But that's all your mind is doing when you manually trade too, only the rules are more complex and you don't always follow them, when a bot will do everything you (deliberately or accidentally) tell it to, without fail, every time.
If you program a mistake in your algo where it will enter a loop of buying with your entire balance and then selling your entire balance, the bot will continue doing that for infinity time, until it is rate limited by the exchange or until all of your balance is gone. It doesn't make judgement calls, lots of algo devs have fucked up royally like this.
His friend just doesn't understand the importance/process of thoroughly testing algos (most likely).
YujinTan
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actually depend the bot you into etc, some does have risk management feature, it keep looking for trades but on the expense of your account, let say you still have some trade running even last for few days
the bot will not trade again depend the rules been set etc.
D
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I haven't really looked that deep into the workings of pre-made bots tbh.
Problem is that detecting a confirmed change in trend is more difficult than you'd think. In hindsight a change from bull to bear is clear, but at any point in time it's actually incredibly difficult to know for sure whether you're going to continue the trend or change to another.
Generalisably profitable algos are the best - ie they work well in all conditions, or at least overall they are profitable (ie in bull conditions no profit, no loss.. flat trends - pick up some profit, bear - highly profitable.. or smth like that).