Is Programming Required for AlgoTrading?

coding-programming

In this post, we’ll take a look at:

Today, by looking at many things around us, it would be quite easy to conclude that programming is an inseparable part of our life, while we are not involved directly. Cars’ smart assistants, cellphones, smart televisions, even a bank’s ATM, they are all created with the help of programmers and different programming languages.

Applications, software, and websites are the best examples describing the importance of, and the strong connection and need between humans and programming. Is it possible to live without phones, cars, computers, websites, e-mails, television? If the answer is NO, then you need programming. No doubt.

The list is not over yet. The financial markets should be added. By introducing the computers, manual trading was somehow replaced by automated trading and algorithmic trading.

What is the difference between AutoTrading and AlgoTrading?

Of course, there are traders today still following the old-fashioned, and trade manually using technical and fundamental analysis trying to find good entry/exit points in the markets. But the majority of trades are being executed using automated trading systems and computers. When there is a computer, there is a trading platform, and a programming language. Let us take a look at programming in the financial markets from a distinct perspective. Is it necessary to learn?

 

Learning A Programming Language – Challenges

Prior to any discussions, it is necessary to understand that whether learning a programming language is your favorite or not. It is not a nightmare, while it is not easy as you might think. Of course, it is not intended to provide details about choosing a programming language from the scratch, or comparing them in the following lines, but three of the challenges will be explained briefly.

1- Learning a programming language is time-consuming.

No matter you are learning Java, Python, or MQL4. You have to be available for that. First it takes times to master the basic concepts and learn the feature of the desired language, and second, there should be enough practice including coding and debugging.

Optimistically, between 9 months to 1 year is the minimum time a person can master a programming language.

2- If you do not know where you are going, you are going nowhere!

It is common that those who start learning the programming language A, switch to the other language B right in the middle of the way. It is mostly probably because they do not know what they genuinely want at the beginning.

Switching between different languages only wastes the precious time. So, it is highly recommended to start learning C++, for example, and not to look at any other options until you become a master.

3- Is programming the right type of Christmas card you are looking for?

It seems wonderful. It is a good feeling when there is a movie in which a hacker is doing an excellent job, transferring millions of dollars just by typing a few lines of codes to his/her personal bank account. But in reality the story is different.

It is not always typing codes and doing big projects over a night. It might take a long time for even a small project to be accomplished. Then there are bugs and different errors need to be tracked and solved. Besides, before coding, you need an already made comprehensive guideline to know where to start, where to go, how to go, and where to end. Are you ready for this?

 

Programming in the Financial Markets

When we are talking about the financial markets, there are few options of programming available, but the challenges are still the same.

MetaQoutes Programming Language known as the MQL—MQL4 for MetaTrader 4, and MQL5 for MetaTrader 5—can be considered as one the most popular programming languages in the financial markets. MetaTrader 4 & 5 are somehow the most popular trading platforms both for trader and brokers.

There are also other trading platforms, each having their specific programming language namely TradingView (PineScript), TradeStation and MultiCharts (EasyLanguage), JForex (Java), etc.

It is obvious that each trading platform needs its own programming language, and if you are working with TradeStation, then EasyLanguage should be your first choice if you to decide to learn.

The main question is still the question. What are the advantages and disadvantages (if any) of knowing a programming language in the financial markets? Is it required to learn? What happens if someone likes NOT to learn any programming languages related to trading?

 

Pros and Cons

To be concise and talking about the advantages of learning or knowing a programming language like MQL5 or PineScript, it should be mentioned as the most important item that when you know MQL5, for example, you have full control over your trading strategies and your trading platform.

If you want to develop your own trading strategy, or if you have an already made expert advisor (trading robot) and you are going to makes changes, you need to know the programming language, in this case MQL5.

It is also possible to ask a programmer to make the changes for you, but there might be an issue. The programmer should fully understand what you need. In some cases this turns into a challenge between the trader and the programmer.

On the other side, learning an object-oriented programming language like MQL5 has its own difficulties. In addition to the time you need to make every day to learn and practice to master MQL5, you need to have a trading strategy. In other words, what is the usage of programming when there are no plans for trading in the financial markets.

One solution to all of the questions and challenges raised is “algorithmic trading” – especially when no programming is required.

 

Algorithmic Trading and Programming

Algorithmic trading, or algotrading, makes everything simple. All the issues can be check solved now. First, no programming is required—at least from the beginning to the upper-intermediate level.

Second, there is no need to think about different trading strategies because the strategies will be created automatically, and the programming code of each strategy will be ready (no matter in MQL4/5, EasyLanguage,  Java, etc.) right after the strategy is built.

For algotrading, there are software, one of the best is StrategyQuant X. This software helps you create different trading strategies without programming. Simply you need to change the settings according to your experience and desire.

There different tabs in builder Settings, each tab is dedicated to a specific aspect of the market. In other words, you have control over various aspects of a trading strategy such as Money Management, strategies’ filtering, trading controls, stop loss and profit target, etc.

 

MQL4-code
The MQL4 code of the trading strategy is ready to use.

 

Is Programming Required for AlgoTrading?

The exact answer can be divided into NO for the beginning, and YES, if you are an advanced algo-trader and want to have a complete maneuverability and full control on your trading strategies.

You do not need to learn programming since there are software like StrategyQuant X, doing everything you need for you, and if there is a situation in which programming is needed, you can simply ask a programmer to help you.

But if you decide to become a professional trader in all aspects, and if you want to control and change everything, or evaluating your own ideas in the markets, then it is recommended to master a programming language.

 

Conclusion

You should make the final decision. For the beginning, it is not recommended to learn a programming language because it is time-consuming, and you are far from trading. Besides, you need a trading strategy first. Without having a proper trading strategy, which is also time-consuming to find, programming knowledge is not practical.

But if you are a professional trader, then maybe it is not a bad idea to start learning a programming language.

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