Automated stock trading is actually a very complex exercise. A typical automated trader will need the following skillset in order to create an automated trading strategy:
- Programming-trained, preferably with an academic qualification in Computer Science or equivalent
- Several years of trading experience
- Good familiarity with technical indicators, trading patterns, AI, etc
- Good in mathematics
Programming expertise is essential for creating the software that will execute trades automatically. This requires knowledge of programming languages such as Python or C++ and a familiarity with the APIs provided by the trading platforms.
Additionally, a deep understanding of financial markets and technical indicators is necessary for creating a profitable trading strategy. This includes knowledge of market microstructure, trading psychology, and the ability to analyze large amounts of financial data to identify patterns and trends.
On top of all these skills, he or she will need to create a very efficient and robust trading, signal, backtest and a multitude of other related engines.
All of these factors make automated algorithmic trading a difficult task for most people and it requires significant time, effort, and dedication to master.
To do all the above well is something that separates a good algorithmic trader from the mediocre.
However, one can easily just deploy a well-built stock trading bot in order to start his or her step into automated stock trading. With many stock trading bots available, it is important for a trader to choose a good software and be aware of red flags.
Further read: Five Things To Look Out For In a Stock Trading Bot