Frequently Asked Questions (FAQs)
Systematic Investors Group (SIG) was started with the mission to "Empower retail traders/investors/small funds by giving them the trading strategies, education and practical software tools to implement their own systematic trading or investing processes that are consistent, so that they can be confident, profitable and compete with the funds and bigger players out there."
"Just wanted you to know (in addition to Dan) how pleased I am with the integration work you've done for Stage 1 and how impressed I am with Alera APM. APM worked flawlessly for Mondays trading session - Executed 37 (Long/Short) trades and closed them all out with MOC orders. With Dan's guidance and advice I have the Day Trade Long/Short MOC strategies setup now in the cloud for full-automation - I just double-check the proposed orders ahead of the market opening."-- Ken(Follow Up) "I'm delighted with APM and the integration work you guys have done - the day trade long/short strategies have now run flawlessly 100% automated for over a month. I just check that everything looks OK a bit before the market opens and check the P&L now and again. It just works and allows me to focus on developing/automating the next strategy! " -- Ken
"Hello Dave,"Thank you so much for your presentation on "soup to nuts strategy development". I had set a goal this year to systematically develop, backtest & automate my trading, and your presentation + code + Alera automation method (given freely!) will accelerate my goal. Thank you thank you, I really appreciate this. You can bet I'll be studying and testing your code for the next month." -- Tony
"I attended a webinar in mid-2020 by Systematic Investors Group showing how Alera Portfolio Manager could be used to fully-automate systematic strategies with Interactive Brokers.
I had been placing trades manually at IB and I decided to take a serious look at it because each trading day I was performing a completely mechanical task that could be done by a program, and I saw the possibility to avoid order errors and discretionary intervention.
I took the trial and followed the course Trading and Investing Automation for AmiBroker which enabled me to get APM up and running with five or six strategies in my paper trade account in a couple of days.
Soon after, I switched all my live trading to APM and now that it’s fully-automated, it’s impossible to go back to manually running systems and placing trades. It has freed up that time for other things.
APM is constantly being improved and the developers are always happy to implement any useful feature I can come up with, and I look forward to those and the new possibilities." -- Faiz A.
Alera Portfolio Manager (APM) Review
"- short term trading strategy now fully automated
- development team willing to implement features for strategy in a timely manner
- worth the subscription cost
- easy to implement proper portfolio allocation
- avoids errors made when entering trades manually
- saves time related to manual trade entry
- no need to constantly monitor system -- strategy can be put on auto-pilot with very little interventionAPM has allowed me to fully automate my short term trading strategy. The development team even worked with me to add software features specific to my strategy. The software makes proper portfolio allocation easy and prevents errors associated with entering trades manually. The automation saves me time and frees me up so that I'm not constantly monitoring my system.
My trading strategy can be put on auto-pilot with very little intervention. Highly recommended." -- Gary
Our mission is to empower retail traders and give them the practical tools to implement their own systematic trading/investing processes that are consistent, so that they can be confident, profitable and compete with the funds and bigger players out there.
At Systematic Investors Group, we develop, backtest and quantify portfolio-level trading and investing Strategies.
Strategies include reversion (pullback), momentum, momentum rotation, trend following and various other rules-based programmatic strategies.
We then help traders implement these Strategies in a semi or fully automated way using software that integrates with Interactive Brokers (and other brokers), so that traders can execute from 1 to many strategies and entire trading plan in less than 5 minutes per day.
There's a number of moving parts to what we do, but it isn't complicated. In fact, once you get it, it will make your Trading/Investing life 100 times FASTER and EASIER.
The easiest way to understand how it all works is to spend a bit of time to follow the flowchart steps (and accompanying videos).
With Systematic Investing (Trading), it is possible to more than double the average returns of the market (i.e. index funds) with less than half of the losses (and risk), with a few minutes of effort a day.
Are you interested in Hedge Fund type results and have considered using a hedge fund in the past? Our Systematic Investing Game Plan membership is like having your own hedge fund and trading desk but without all the fees. In fact, you can have it all, including all the winning Strategies, for one FLAT FEE per year without all the performance fees. Whereas a hedge fund might charge 2% (flat) and 20% (performance), for a $200,000 account that would be $4,000 (for the 2% flat portion) plus 20% of profit... so, for example, with a Hedge Fund, for a $30,000 profit it would cost $6,000 for a total of $10,000 in fees!
( Click Here to Link to the New Member Orientation Webinar / Presentation recording. )
1. The first thing to do is get oriented on Systematic Investing. Review the entire MasterClass on Systematic Investing in order to get up to speed on the concepts.
2. If you are a Strategy Developer and interested in integrating your own Strategies using Alera Portfolio Manager (APM), the Trading & Investing Automation for AmiBroker Course would be next.
- If you want to learn even more about this topic from a slightly different perspective, starting from Strategy Development in AmiBroker all the way to AutoTrading, review this blog post and video presentation (which includes an AmiBroker Strategy Code Template and Helper files) -- 'AmiBroker Strategy Development and AutoTrading'.
3. Review some of the various Strategy Scans that are available, and start to understand their respective Backtests (see Backtesting Mini-Course here). See which fit your risk tolerance, temperament, qualitative criteria and that you might like to start testing.
Categories of Strategy Scans available are...
a) Free
b) Pro
4. We always recommend that you first paper trade your Strategies for some time before committing any capital to live trading. You can paper trade/test manually of course, but we use and recommend an incredible software tool called Alera Portfolio Manager (APM) for all of our (paper testing and live) workflow and trade automation needs. Watch these videos to better understand the process.
5. When you are ready to move forward with your SIG Pro Membership, you need to specifically request each item once you are ready for that step.
a) Request Access to Strategy Scan Signals for use with Alera Portfolio Manager (APM)
b) Request Alera Portfolio Manager (APM) Activation - only do this when you are actually ready to live trade so that the "clock doesn't start ticking" on your APM License. In the meantime, you can paper test all of your Strategies. In fact, you can run a paper testing instance of APM even when you activate your live APM License and run them at the same time, so that you can test new Strategies all the time. Click here to download a fully functional paper testing version of APM.
c) Request Access to Complete AmiBroker Code for 3 Strategies - only if you are an AmiBroker user and Strategy Developer/Coder.
6. If you have any questions, reach out to the community in the forums or contact us directly.
All questions related to Memberships can be found on this page, just below the Membership Level/Sign Up info (scroll down below "Get It Now" buttons).
( This page contains a summary of all available Strategies and basic performance. )
Generally, different Systematic Strategies have different performance profiles that are tied to their RISK -- specifically the amount of draw down that one is willing (or able) to tolerate. Although we have access to Strategies that perform 20-30-40% per year on average, we typically do not publish these Strategies because we know from experience that most Traders/Investors can not emotionally deal with potential maximum draw downs that are greater than 20%. Strategies that deliver higher returns are pretty much guaranteed to have correspondingly higher draw downs and this fact is universally unavoidable.
(So if you are currently trading or considering a strategy such as an option selling strategy that boasts 30% returns per year, you may have not considered nor have been able to quantify how big your draw downs will be when markets eventually test you - and they WILL! These types of Strategies will hand you large double-digit losses eventually.)
Although we will in the future publish Strategies with much higher returns (with the above understanding), you will be able to combine higher return (and higher risk) Strategies with other Strategies and Methods that will reduce your overall risk and draw downs to more acceptable levels.
The general goal of Systematic Investing is to get returns that are very good, better on average than the market (Index Fund, etc.) BUT with much lower draw downs and volatility. Systematic Investors have the advantage because they can expand on this idea further by combining multiple Systematic Strategies to improve returns and further reduce draw downs (and reduce the volatility of returns).
A good way to get started with a solid understanding of Systematic Investing, is by reviewing the Systematic Investing MasterClass and the FREE Backtesting Mini-Course.
For each Systematic Strategy that we publish Strategy Scan signals for (perhaps with the exception of the Contributor Series where Contributors may not want to share their strategy rules), we will be publishing Strategy Sessions.
The Strategy Sessions will specifically cover the rules of the Strategy as well as go deeper into the Strategy's specific Backtest results and interpretation. Once the Strategy Session is published, a button link will be available on the specific Strategy page so that Members can review the Strategy Session and take a deeper dive into the nuances of the Strategies that they are really interested in.
Here are the Strategy Sessions for the Free RSI 2 Strategy and the Super-Charged Momentum Trend Strategy.
As a member, you can access the "SIG Strategy Mix Tool" in the Systematic Trading Plan Development Workshop -- specifically in the Course Downloads and Resources section of the course.
This tool is designed to allow you to see the benefits of using multiple Systematic / Rules-based Strategies in developing your own Trading or Investing Plan.
APM is a unique software tool that levels the playing field for retail traders.
In a nutshell, the software essentially enables AutoTrading (either semi or full automation) as well as full Portfolio Management.
It empowers you to be 100% consistent and save time while deploying your Trading Plan.
It allows you to run multiple rules-based, systematic or algo-based strategies and manage your entire workflow in just 5 minutes or less each day. The Strategies can be your own local strategies, or strategies delivered from the Internet from various Strategy Development Partners such as ourselves (Systematic Investors Group).
Please take a few moments to watch the below video...
Visit Alera Trading's website here for more information.
Visit Alera Trading's Youtube Channel here for more videos, demonstrations and presentations.
We are big on End Of Day (EOD) PORTFOLIO-LEVEL trading and investing Strategy Automation! It's kind of our "thing". And for good reason.
Here's a great way to get started paper testing a few of our Free (but Pro-Level) Strategies using your own Automated Setup.
Strategy Scans + Alera Portfolio Manager (APM) = Pretty Darned Awesome!
You can download/install a Free Paper Testing version of APM from Alera Trading here.
You will need a Paper Trading account with Interactive Brokers (IB) to "execute" the trades. Our instructions show how to use APM with IB Gateway, but you can also connect APM to IB's Trader Workstation (or TWS), too.
To use a free paper trading instance of TWS without having to set up a full IB account you can download and install TWS from www.interactivebrokers.com and then after launching, select 'Paper Trading' and then 'No Username? Try the demo' -- see below image. Here's a good article that explains the entire download process.
NOTE! : The big issue with using TWS in demo mode (without having a full paper trading account) is that every time you reconnect you get a new account number with no positions. So you may use it to start Alera Portfolio Manager (APM) to get a feel for the process, placing orders and getting connected up for a quick demo, but all portfolio info will be lost as soon as you log out from the IB (TWS) demo account -- which typically happens with TWS every day as a result of their nightly reset. You will therefore not be able to maintain your portfolio (positions) from one day to the next should you want to see how multi-day systematic portfolio trading progresses. (If such is the which case, please contact Interactive Brokers directly to request a full paper trading account).
If when AutoTrading your IB Gateway disconnects from Alera Portfolio Manager (APM) every morning, here's what you can do...
We are completely separate companies and separate entities.
However, we do have a working relationship where Systematic Investors Group undertakes the marketing of the APM software. Why? Because we were Beta testers of the software, we use it ourselves and absolutely love the software and what it can do for Systematic Investors and Traders. We stand by it completely. I don't think we could go back now... I doubt we could live without it anymore!
Because of our good relationship with Alera Trading, business marketing arrangement and technical experience with APM, we often also offer technical and integration support for APM as well.
Click Here to read this more in-depth blog post!
When getting started with Systematic Investing (Trading), you should have at least 10,000 US dollars. The reason is that most of the trading that we do is portfolio-based trading of stocks with 5-20 individual stock positions in a portfolio to diversify opportunities, spread risk, and lower draw downs caused by any one (1) position.
More realistically, you'll probably want to trade at least 20K per Strategy and then increase that amount per Strategy as warranted, so that commission drag on each Strategy isn't too high.
An ideal starting point would be around 50K US Funds for 1-2 Strategies, and better yet, about 100K for 1-3 Strategies.
For "Auto Pilot" or "Fully Automated Trading" Set Strategy Schedulers for 9:05-9:10 am EST (New York/Toronto Time). Once in a while we may experience issues with our SIG signal server that generates all of our strategy signals, for various reasons. Unfortunately with any technology problems are unavoidable and will happen from time to time. To mitigate this, we check our signal server manually each morning and are usually able to get any issues sorted out by 9am EST (New York/Toronto time). For those situations, it often-times means having to re-run all of our signals and Strategy Scan website posts.
For this reason, it is suggested that you set your scheduler/timer for strategies to run just after 9am. To be safe, set to 9:05 or 9:10 am EST. This way, the strategy signals will be updated if there are any technical issues encountered over night where strategy scans need to be re-run, and, your strategies will have enough time to process and send any Market On Open (MOO) orders to the market before the open auction cut off time. If schedulers are set too early, you may miss entry and exit signals on those days where the SIG signal server had technical issues.
BTW, you may run our Systematic Strategies in Alera Portfolio Manager (APM) using IB Gateway or a full TWS Interactive Broker Connection, depending on your preference. The difference is that IB Gateway is a bit more "light-weight", doesn't have a position user interface (or charting as does TWS) and IB Gateway tends not to disconnect as often as TWS (which tends to reset every night). Our personal preference at SIG is to use IB Gateway and leave the instance of APM and IB Gateway running at all times (even though APM and the broker connection can be shut down after all orders are sent to market if no other order management is required for the day... of course, depending on the rules of the specific strategies in operation).
The buy orders being missed don't matter so much, however, you would miss signals in order to sell your existing stocks if any sell signals come up.
Some strategies use "impulse signals", which means they generally are only valid for that day. An example would be a "cross over" signal. Other strategies use state signals, meaning that if the state is currently true then a sell signal might get generated for multiple days. You generally don't want to miss signals, particularly sell signals, on any day and should try to manage just the few minutes taken to make sure that your orders reach the market.
There are a few options...
1 - Load your setup onto a cloud instance of AWS or other cloud computing instance and just check in for a few minutes each day while travelling.
2 - Sell your entire portfolios and pause the strategies until you return.
3 - (* See below). Let the strategies lapse and then reconcile the stocks that you might need to sell when you return. Not a great option, but do-able. You would either need to manually close out the stocks based on your understanding of the strategy rules, or, pull up a history of the signals manually and check each day's sell list for the stocks currently in your portfolio... a bit cumbersome, but again, do-able.
Your choice will depend on your level of comfort with the decision and potential risk.
(*3) - How do you find a history of the (sell) signals manually for a Strategy?
Because the signal pages for Strategy Scans are "posts", there is a history kept on our website. It is only a few days long, however.
- Navigate to the "Trade Ideas" menu and find the Strategy Scan page of the Strategy in question, then find the exact name of the Strategy and copy it to your computer clipboard. For example, this is the RSI-2 Strategy Scan page.
- Paste the name in the search function of our site by clicking the little magnifying glass in the upper right hand corner (furthest right) of the main menu, then right-click your mouse and select Paste from the short menu that pops up. Hit return/enter.
- A list of posts will show up with dates appended to the Strategy name.
- You can open each post in a separate tab and review all the signals that were posted for that Strategy and for that trading day, to determine if any of your stocks should have been sold on any particular day.
Refer to this link for more information related to video playback issues.