The world is now at a zone where retail traders are overpowered by the use of High frequency traders or traders working with algorithms to increase there profits. Having an experience of about 2 years in Trading, I have always fascinated by the concept of algorithmic trading. Thus gave a try on algo-trading. Algorithms have gained popularity in the trading landscape and many big clients demand it. These mathematical algorithms analyse every quote and trade in the stock market, identify liquidity opportunities, and turn the information into intelligent trading decisions. Algorithmic trading, or computer-directed trading, cuts down transaction costs, and allows investment managers to take control of their own trading processes. Algorithm innovation continues to offer returns for firms with the scale to absorb the costs and to reap the benefits.
One of the big reasons that algorithmic trading has become so popular is because of the advantages that it holds over trading manually. The advantages of algo trading are related to speed, accuracy, and reduced costs.
Since algorithms are written beforehand and are executed automatically, the main advantage is speed. The speed at which these trades are made is measured in fractions of a second, faster than humans can perceive. Trading with algorithms has the advantage of scanning and executing on multiple indicators at a speed that no human could do. Since trades can be analyzed and executed faster, more opportunities are available at better prices.
Another advantage to algorithmic trading is accuracy. If a computer is automatically executing a trade, you get to avoid the pitfalls of accidentally putting in the wrong trade associated with human trades. With manual entries, it's much more likely to buy the wrong currency pair, or for the wrong amount, compared to a computer algorithm that has been double checked to make sure the correct order is entered.
I have used the API of Fyers and Angelbroking both, AngelBroking was more stable in my case, so I have used AngelBroking API here.
A Trading API allows the trader to write their own computer programs for trading or using the third-party trading platform. Trading APIs are for traders who wish to run algorithmic models on their own trading systems, receive real-time pricing, and perform trades.
The algo trading API's help traders in building their own customized trading application. Traders can execute orders in real-time, manage user portfolio, stream live market data, and much more, with Trading API. Only a few stock brokers in India offer trading API, and due to this only a handful of people get the advantage of high frequency trading