Setting Up Your Stock Trading Bot
A tutorial guide on how to quickly and easily set up a StockHero bot
A picture is worth a thousand words. Take a look at our Quick Start image below. A detailed guide is provided after the image.
StockHero allows you to automate trades right from your computer or phone. No coding skills are needed. Trade popular stocks such as Tesla or Apple with bots based on technical indicators 24/7. Sign up with StockHero and get your first bot running in just five simple steps.
StockHero is a Software-as-a-Service (SaaS) platform that offers automated and algorithmic trading features to our users in a user-friendly interface. Unlike many other platforms that require you to send funds to them, StockHero does not. Instead, it trades from your existing brokerage account (e.g. TradeStation.com) using an API (Application Programming Interface) connection.
Check out the video that explains how StockHero works.
Integration with your brokerage can usually be done in a few clicks in StockHero. As you start your journey of algorithmic trading with StockHero, you will be pleased to know that so many complex features are now distilled into a simple and intuitive User Interface.
TIPS: If you are not sure how to configure a bot or just want to get going asap, you can rent one of the bots from our Bots Marketplace.
Check out the Tutorial section in our Blog. Or view some of our tutorial videos in our Video Gallery!
1. Asset
Start by connecting to a brokerage or using a simulated paper trading account. In StockHero, a paper trading brokerage named "Paper" has been created by default. All trades done within the Paper brokerage are risk-free and use fake funds. Once your brokerage account has been connected, a list of available stocks will be available to you for selection.
If you do not see a stock that you would like to trade, send us an email ([email protected]), and we will add it within a day.
TIPS: Many StockHero users prefer to trade on their own online brokerages and simply rely on StockHero as a signal (when to buy and sell) provider. Read this article to find out more. However, integration with any of our supported brokerages will offer you automated trading capabilities. You do not have to do anything!
The choice is yours.
A Long strategy aims to buy a stock at a low price and sell it at a higher price. It requires your brokerage currency, usually USD, to execute the trade.
StockHero also supports the Short strategy. There are two types of short strategies - the physical short and margin-short. To run a physical short strategy, the bot will sell the underlying stock that you already own. For example, if you want to short AAPL, you will need to own AAPL shares in your brokerage account.
StockHero also supports margin-short. In the latter's case, the bot will use the brokerage currency (e.g. USD) to sell the stock. You do not need to own the stock in order to run the margin-short strategy. Margin-short will usually incur a borrowing cost charged by the brokerage. Please check with your brokerage on the cost.
Please note that margin-short is only available on selected brokerages and for Premium and Professional subscribers.
2. Trade Parameters
StockHero will get the holdings from your brokerage account and display the available currency balance to assign to the bot. In most cases, the bot will not use more than the capital set in the Fund Allocation parameter.
If you do not see your available cash balance, check with your brokerage and make sure your trading capital is made available for trading.
3. Entry Conditions
StockHero allows different rules for entering and exiting a Deal.
A deal consists of a collection of trades. Whenever a bot buys a stock for the first time, a deal will be created. A bot can continue to buy the same stock, depending on the entry conditions. Once the bot's exit conditions are met, it will sell the stock it has bought. This completes the deal.
Users may enter with Bollinger Band and exit with EMA or set up multiple 'and' and 'or' rules with multiple indicators.
It takes many years of trading experience to create a strategy that works the majority of the time. Hence, for users new to the world of algorithmic trading, we recommend taking a look at preset bots available in StockHero's Bots Marketplace.
4. Exit Conditions
Exit conditions using a technical indicator are not a requirement. Users can choose to exit using Take Profit or simply using Stop-loss for a buy and hold strategy. Stop-loss and Take Profit are not considered indicators and will be prioritized ahead of any indicators.
5. Backtesting
You may now backtest your strategy across different time frames to ensure the strategy is viable. Past performance does not guarantee future results. Backtesting is only a tool to evaluate a bot based on historical data.
StockHero allows you to backtest various time windows. For example
1D = Last 24 hours
1W = Last 7 days
After you have selected the time window, simply click the Run Backtest button. Professional plan users will have the option to run custom backtest time window.
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