I am quite sceptic about autotrade (any, not just C2). To be more informed, there is no better way than to try it. I have some questions on autotrading with IB:
1) Can I do a test autotrading a system with IB Demo account?
2) Does IB (demo or real) need to be up and running for the autotrading orders to be executed, or not?
3) IB does not support C2 Gen3, if I got it right. So does that mean that I could not intervene on automatic trades (like closing out a position or inserting a stop) ? Does it also mean that Autosync will not work with IB? What would happen if there is an interruption of connection or any other glitch? In other words is it "safe" to let autotrade manage trades within IB for long-ish periods of time (4-5 hours)?
4) Would all the issues above be overcome by using a broker that supports Gen3?
I would really appreciate any input, especially form users.
Thank you for your help
I am quite sceptic about autotrade (any, not just C2). To be more informed, there is no better way than to try it. I have some questions on autotrading with IB:
I tried to autotrade a demo IB account last year with Trade Bullet for a couple of weeks.
It was a mess.
Essentially what you have is an automated transaction system that hooks 3 parties together - C2, Trade Bullet and IB. Professional software designers/programmers know that the more different parties involved in a tightly coupled environment like this, the more chance for integration problems. Now throw in real-time processing as well and what you get is a “system” that is never stable for long.
That means you CANNOT leave it alone (the goal of auto-trading??). If I have to babysit it, then I don’t need auto-trade. It is a travesty that C2 can’t get IB to agree to a Gen 3 interface agreement - but that is out of our hands.
Until such time that that occurs, I cannot use my IB account for trading systems at C2.
Skip mentioned that he traded with an Interactive Brokers demo account, and there are some significant issues that you will see when you use an IB demo account. The main one is that the IB simulation does not support all instruments and symbols, and – more important – its simulated price feed may be delayed or incorrect. So it isn’t going to be a perfect simulation of real trading, but it can at least give you an idea of how the process works.
(I don’t know if the problems Skip experienced were solely caused by the fact that he used a simulated brokerage account. What I can say is that many customers are happily using Gen1 AutoTrading at Interactive Brokers, using either Trader68 and TradeBullet, and so I am not sure I agree with Skip’s assessment that Gen1 autotrading is a mess. Gen1 is obviously more complicated to run and setup than Gen3 server-based trading, but for some users this is an acceptable tradeoff.)
Regarding your other questions:
a) For Gen1 AutoTrading with Interactive Brokers, the answer is: yes, you need to keep IB’s TWS app running on your home machine.
b) It is true that currently Gen1 autotrading doesn’t support manual overriding of stops/limits/positions via the C2 interface. Of course you can turn off your AutoTrade software client and manually trade in your account at any time.
c) Gen3 AutoTrade is server based (meaning you don’t have to run anything on your computer), and there is an AutoSynch process that keeps orders and positions synchronized regardless of unexpected events, failed orders, etc. So in theory it’s more reliable. It also supports new features such as user-applied automated stop losses, and manual management of positions, stops/limits, etc. On the other hand, not all brokers support it, and there are additional costs to using it. So Gen1 is the right choice for some users, and Gen3 may be the right choice for others.
First of all thank you very much Skip and Matt for your replies. By the way, Skip, I greatly enjoyed your “analyst notes” on various systems and I wanted to get in touch with you. Is there any way I can send you a PM? (if you are willing to receive it, of course)
Back to IB, I know IB demo has always problems for more advanced tests. I was not sure if I needed an additional software to link it to C2 and the whole thing sounds a bit too complex to trust the technology. I see your points, Matt, but I feel closer to Skip’s view on this (demo or not).
It looks as a no go for me, but I would love to hear from actual users all the same.
It is probably easier to use OEC, if one really wants to go in that direction.
Thank you again and I would love to hear more
Jools - Instead of using a Demo Account at IB apply for and open a Paper Trading Account which works exactely the same way as a real account with real data feeds - I think you need to have an existing account with IB in order to do that. I tried it with TB for several C2 systems and it worked perfectly, exactely the same way as it would in real life trading - Karl
I forgot to mention that I opened a second instance of TB on my computer when trading the Paper Account in order not to disturb my existing running C2 systeme. Instructions how to do that you can find on the TB web site -Karl
Thank you very much for this. I have been an IB client for more than 10 years and I have just given up trying to follow all the updates they make. I did not know of Paper Trading account. Perhaps I should pay more attention.
Can I ask if you actually trade any system real time with IB and bridge software and if you are really "leaving it alone" or you baby sit it some or most of the time?
Thanks and regards
Jools - I trade quite a few C2 systems, all of them via TB/IB except one at OEC which is primarily for test purposes. I do not want to disclose them because everyone has to make his own determination according to his risk appetite and capital resources. The big advantage of trading all systems at IB is that you can trade stock, futures, forex and option systems all out of one account and since it is unlikely that all systems have the maximum drawdown or maximum margin requirement at the same time you can trade many more systems with a given minimum capital than if you had to spread it out over several brokers. I did not experience any better fills at OEC and with the high C2 surcharge many systems are unecconomical to trade there. Of course the big advantage is that you don’t have to worry about problems with your computer connectivity.
I wish I could say I don’t monitor the trading during the day even though lately I have not experienced any problems with the systems I currently use - after some time you will learn which systems or which vendors to avoid and yes, I have lost quite a bit of money in the past caused by clear C2 malfunctioning and all you can expect is an apology by Matthew. I am still staying with C2 because presently there is no better alternative for this type of trading model. If Matthew could get a Gen3 connection to IB I think this would catapult his company way above the competition including those which recently have implemented a direct connection to IB. I think most of C2’s revenues come from the constant stream of new vendors and it seems to me C2 tries to accommodate them first and sometimes I feel subscribers who put their money on the line have to take a backseat.
Still, I want to make clear that I have the highest admiration for Matthew and what he has created here - even though on several occasions in the past he has deleted messages I posted here about sensitive subjects - and I hope he will continue with his success and further improvements of C2. - Karl
I’d be happy to discuss items off-line. You can reach me at firstname.lastname@example.org.
One of the issues with Gen1 (if I recall accurately) is that I have to leave my computer running. For those of us who have a busy schedule, or travel a lot, or are retired - having to baby-sit a computer at home or at the office adds another layer of complexity that just isn’t worth it.
For instance - what happens if I am away over night and my power goes out? I will probably not even know it for a while. And I am autotrading a 24/7 Forex account?
And Karl’s comment on the money he has lost due to C2 problems is a very good point - I’m not interested in trading ANY systems through ANY site that could lose ANY of my money. That seems ridiculous to me.
Would you maintain an account at a “normal” stock brokerage if your account took a few hits now and then and went down in value SOLELY DUE TO TECHNICAL ISSUES? I THINK NOT.
Autotrade is the Holy Grail of technical capabilities. When it works perfectly every time - then my hat is off to whoever built it. If they will not take monetary responsibility for their errors (not mine), however, then I will not be buying what they have to sell.
Let’s say that a trade goes awry and you lose $1,000 on it. And let’s say C2 did its part right, but somewhere between it and TradeBullet (or any other sort of bridge software) and IB, something wrong happened. The data that IB got, or didn’t get, was wrong - and you lost $1,000. Who is to blame? Hard to say.
But you still lost $1,000. Not acceptable.
Just to say “Well - it’s not perfect, it’s the best we’ve got” is not enough when it comes to MY money.
I know Matthew would like to resolve the IB/Gen3 problem. And I hope he does. I have said this before on this site - if you scan backwards through many of the comments - there seems to be a regular stream of autotrade problems. From everywhere.
What is that regular stream saying to you? Hmmm…
I am cheering for C2 - I have even offered to help them test systems or whatever.
I hope this helps.
Thank you very much again for your input.
Karl, of course I was not asking to disclose what systems you trade. It was a general question, although I think that there may be a big difference between autotrading a fast high frequency trade systems (with possible overlapping of orders/cancellation and so on) and a âquietâ system that you can âbabysitâ more effectively (because babysit you have to anyway with IB!)
Irrespective of that, there is always the syncronisation problem and disconnection issue that Skip is talking about. I wonder whtether OEC or indeed FX brokers for FX systems have sorted that out with C2/Gen3. It looks like they somehow did, as you seem to imply by saying âOf course the big advantage is that you don’t have to worry about problems with your computer connectivity.â Or am I wrong?
Skip, I agree with you completely. I have to say that one is never completely sure about connection problems, unless he/she uses exchange native orders, which are stored in the exchanges servers. Even so exchanges or brokers do not take responsibility for them, I think. I have had technical issues related losses many years ago âautotradingâ my own systems on Tradestation. The stream of problems that I see here and in other places only increase my anxiety.
My idea is to diversify my portfolio by trading different systems in different asset classes. I favour longer term systems and I can trade them manually. But some systems (especially futures and some FX) are impossible to trade if not on autorading, I was trying to see if there is a solution to this issue.
This is an interesting topic and I hope it is useful for others, so I hope here will be other contributions.
Thank you again and best regards
Jools - When I said "connectivity problems" I meant problems with your home computer or internet service provider. For futures, as far as executions and fills are concerned, I have not noticed much difference between OEC and TB/IB. For forex I almost always get better fills at IB than what is shown on the hypotheticals, in addition C2 tacks on a high fee (depending on the trade size) to Gen3 forex trades.
There is no question that you have to be willing to assume higher risk when you use alternative investment vehicles in general and auto trading in particular but I can also say that over the last two years my overall portfolio return was much higher than if I had left my money in mutual equity or bond funds or CDs for that matter. - Karl
Karl, Thank you for your input. Very informative indeed.
here just a few additions from my side. I autotraded several systems through C2 on IB.
The issues with paper trading have already been mentioned. If you only want to test a system, it should mostly be enough (however, still the data on the paper trading is not the same than on the real trading account, so you still have an additional layer of issues).
I did real trading of the systems. It was impossible to use my home machine due to the baby-sitting issues (and also you get problems if you have to reboot your computer, loose connectivity, etc.) So I got myself a server-based VM on a rather stable network, that provides the 24h trading.
In order to have non-stop trading you have to use a tool like IBController. This will enable permanent functioning, even though
TWS tries to logout every 24 hours.
I used Trader68 because it was free, so I cannot offer any experience with tradebullet or any other intermediary. Most problems I got were, however, related to Trader68 trying to be smart about the trades, and messing things up in the process.
However, in the end I had everything rather stable. But outages did occur (which resulted in missed trades), though rarely. So sometimes I left the setup unintended for many hours. By and large, this was not a problem.
I stopped this, when Trader68 introduced higher pricing. Then it was simply no longer beneficial. Also, before I subscribed to some systems which were good until I subscribed and tanked as soon as I subscribed…
Given the cost of server, Trader68 or Tradebullet, C2 costs and the typical cost of trade-execution on one hand, given the typical income of a system, you can determine how much capital you would need to win more than the costs and what the split of costs for others vs. personal income would be. In the end this sum turned out to be higher than I wanted to risk, particularly, having mainly lost money in most attempts.
But your mileage may vary, depending on how much you want to risk.
(Above there was also the comment: "I do no want to risk my money" - in this situation trading is not for you. No matter how good the system is you pick: it is always your money which is at stake.)
Hope this helps
When you trade through the IB Gateway you aren’t logged out every 24h. I don’t know, when you get logged out, but my systems runs from Monday to Friday without logging out.
Josef - It seems to me logging out of TWS once a day for just a minute does not present much of a problem because one can set the log out for a convenient time when one is sure to be at the computer in order to log right back in after a minute.
But you got me curious when you say one can avoid that by using IB Gateway. Are you using TB with IB Gateway? I was not able to establish a connection this way. Could you please elaborate. - Karl
I also tried to be always at home when TWS did the 24h logout process, but as we all know it isn’t possible all the time…
Yes I’m using IB Gateway with TB.
1) Start the IB Gateway and log in.
2) Have a look at the port/ip adress in the settings of IB Gateway
3) Go to TB and make sure that the settings for IB are correct.
4) Try connect to IB through TB Mode "Live"
This worked for me. Don’t hesitate to ask for further questions.
Thank you all for your input. Very interesting.
So, once again what are the main issues:
1) IB has to be on all the time that C2 autotrade fires orders. Even if there is no connection problem (big if) , IB logs out once a day, cutting off the flow. If one uses only day-trading systems (no overnite positions/orders) there is no problem in IB timing out at the end of the day and shutting down all PCsâ¦.right?
2) During the day, there may be interruptions/disconnections in any part of the links, so we need to babysit. What happens to the autotraded orders/positions etc, in such a situation? Do we lose the flow and when the connection is back the system does not know/understand which position is which and which order is active or linked to? If so, do we have to manually input the âcorrectionsâ, where applicable? Re-start the various connections again and what is missed is missed? (If so, there has not been any real progress there since my last go at automatic trading on TS several years ago!)
3) Now IB Gateway arrives. I understand that it may solve problem 1. Does it help at all in addressing problem 2? How?
Apologies for my lack of knowledge in this field
I’m also concerned about the problem 2) you described. Therefore I’m writing my own software which, I hope, handles this issue correctly.
I couldn’t find any software at the moment which nearly solves the problems you described and I think all of us ran into once.
Josef - I really appreciate your input. Yes, I was able to get the connection through IB Gateway and now I know that I have another tool available should I need it in the future. Since from time to time I manually override systems - probably not a good idea - and since I trade quite a few systems it would be hard for me to do that without the visual interface of TWS. Presently I have the TWS reset time set at 16:15 ET, the most unlikely time a system would send a signal, and after about a minute I log in manually to it and TB. During the rest of the time there are often short disconnections from TWS, ususally not lasting more than a few seconds, but after the connection is automatically reestablished both TWS and TB come on by itself again. One thing to watch out for is sitting forex stop and limit orders, they will still appear on your TWS after the resetting but they have been altered in a way that TB will not recognize them when the system cancels them so you have to cancel them manually but I have learned to live with that.
I wish you good luck with developping your software - who knows maybe you can seel it then - Karl
I just wanted to mention one last thing about my setup:
I have a Advisor Account at IB and several Single Accounts with the same TaxID under my Advisor Account. So they all belong to the same person.
For example, I trade automated systems in one of the single accounts through the IB Gateway, but I can still have the visual input from the TWS. You can also assign several systems (Forex, Futures, Stocks) to several accounts. So you have a better RiskManagement by your Broker itself. This is a good strategy for systems, which don’t come with stops automatically.