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Wednesday, December 14, 2011

Automated stock trading with Prodigio RTS

Last weekend, during my usual web surfing thirsty for market analysis I came across Prodigio RTS. Prodigio is a tool that allows you to trade stocks based on technical rules. It has many technical studies and strategies already built in but you can design your own.

The good thing is that you don't have to be a programer to design and test your own strategies, it is all done visually by dragging and dropping rules, technical indicators, charts and candlestick patterns and values in a section called the "Wizard Lab".

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I was impressed by the complexity of the software. The Introductory video pretty much says it all and I recommend you to take a look in your free time.

Prodigio somehow reminds me of my old days trading Forex, when I got to program about 30 to 40 of the most popular strategies as well as the most weird and promising ones and they all messed up in the end. Trading based off technicals only is very tough, might work for a while but fundamentals do really come into play and are a force to reckon with. So, right now I lean more towards semi-automatic trading where you activate your scanners or mechanical strategies after the sentiment is clear to one side or in periods of absence of influential news.

In any case, overall, Prodigio RTS is a great attempt at automating your technical strategies if you have one. It also allows you to backtest it over a period of time for a basket of stocks so you can quickly validate your ideas.

The weaknesses that I see in the software itself is that it doesn't allow you to simulate Options trading, but only stocks. Also, in the backtests you cannot test more than 6 months in the past which to me is crucial. Anyways if you have a solid strategy which has given you good results over time, then Prodigio might be your next step in fully automating it.

The best part of it, is that it is free! Prodigio is added as a plugin to the ThinkOrSwim platform. ThinkOrSwim which is by the way one of the best trading platforms out there and also free to use.

Now, my TOS platform didn't show any way to access Prodigio once I installed the package, so I wrote an email to asking for activation, they replied asking me for my demo-account number and a few minutes later the "Prodigio" button showed up in my Trade tab on the ThinkOrSwim Platform

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Have fun with that, and hopefully it becomes a useful tool for you to quickly validate your ideas. Remember it's all free! And as usual with automated trading, please be extremely careful.

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