Vertical Solutions

Notes on trading system design and the pursuit of automation

Animating an Answer to Search for a Question

Can a trading system be built without using any historical data?

Building a trading system usually involves a design goal, the search for a suitable set of anomalies in the historical data, the design of trading algorithms, the application of exit strategies and then rigorous testing against historical data (Control Charts).

But.

What would happen if we didn't use historical data?

What if we turn the whole design process around and build the trading algorithms first and then apply the data to them last?

What new kinds of algorithms and systems would be enabled, designed and necessitated?

Would the system need a feedback loop so it could learn or could it search for and pick up on some resonance in a market like a glider gun from John Conway's 'Life'?

What is the design goal for a trading system that has never seen a single tick?

Building a trading system without historical data is like animating an answer to go in search of a question...Wolfram Tones

Henry Carstens
Vertical Solutions
carstens@verticalsolutions.com