How we do it
THE MECHANICS BEHIND THE BOTS.
Analyze market data & create strategies
Our systems communicate directly with multiple exchanges and data lakes, to get real-time & historical data. That data is analyzed based on your preset conditions to find the right trades. The value they offer is incomparable - exceptional speed and efficiency, fewer errors and emotionless trading.
Create Simulation models & backtest strategies
We backtest and evaluate the performance of the identified strategy using historical data. Back Tests are performed using the most recent data (2 - 5 years) available, depending on the market. We run them several times to identify areas for improvement, fine-tuning the method as we go.
Back Tested and approved strategies are then run on our proprietary paper trading system. Our system mimics the market in real-time with very low latency, matching exchange conditions, including but not limited to the order books to find the most optimal entry & exit positions. We model strategies for weeks, fine-tuning and enhancing them until they are ready to be deployed.
Automate Strategies
After the strategies have been tested and simulated, they are put into action. Our systems are set up to trade several pairs on multiple exchanges at the same time. Our dashboard displays the performance of your account.
"One day, years from now, a trading desk will typically consist of three things. A man, a dog and a computer.The computer's job will be to trade. The man's job will be to feed the dog and the dog's job will be to bite the man if he goes anywhere near the computer".
Market Making
Market makers are the best friend of every exchange. A market-making strategy is a low-risk approach for generating liquidity by filling the order book with buy and sell orders so that other market players can execute their orders as needed.
High Frequency Trading
High-Frequency Trading (HFT) is all about speed. This technique uses various algorithms to analyze the smallest price changes and discrepancies between the same asset prices on multiple exchanges. Typically, HFT platforms and systems can automatically open and close several positions per second, aiming for short-term goals that would otherwise go unnoticed by the naked eye.
Arbitrage
Arbitrage is about leveraging prices to your advantage. Arbitrage is a low-risk strategy that allows investors to capitalize on slight price discrepancies of a digital asset across multiple markets or exchanges. In its simplest form, arbitrage trading is the process of buying a digital asset on one exchange and selling it (just about) simultaneously on another where the price is higher.
Types of Arbitrage Strategies
Trend following
Trend following involves doing technical analyses using indicators to gauge a trend. Trend following indicates buying an asset when its price trend goes up and selling when its trend goes down, expecting price movements to continue. The goal is to profit from the underlying asset's upside potential while minimising the downside risk to a minimum. These can range from moderate to high-risk.
We have been customers of QSD Algos for over a year now. QSD's Algorithmic trading provides a competitive edge over the rest of the market. It has given us more accurate trades and has gone beyond our expectations. I would recommend this to any funds looking to dip their feet into algorithmic trading.
Aditya Bhat, Chief Investment Officer Pegasus Ventures
Return on investment in 2021
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