Algorithmic Trading for the Savvy Investor

Create your own Low-cost Hedge Fund with Arcade Trader + AlphaHub

Wouldn’t it be awesome if everyone could have access to the same returns as the large investment firms? This was the driving mission behind why we created Arcade Trader: to provide the power of Algo Trading to consumers.

The challenge is that not everyone is a programmer and/or knows the fundamentals behind writing a profitable strategy, which is pretty much the Holy Grail for Algo Traders.

Well, we have some exciting news to share. Starting from today, Arcade Trader is partnering with Alpha Hub to transform trading signals into trading orders so that everyone can now have the tools needed to create their own personal Hedge Fund.

Who is Alpha Hub?

Alpha Hub is a Trading Signal generator powered by multiple algorithms.

Alpha Hub is backed by Quantonomy, a proprietary algorithmic trading firm that combines the latest advances in artificial intelligence, machine learning, and econophysics to create highly profitable and adaptive trading algorithms.

Unlike other algorithmic trading firms, which rely on traditional financial indicators derived from the field of financial engineering, Quantonomy employs a highly scientific approach to the development of our trading strategies, market models, and adaptive execution platform. Quantonomy combines complex mathematical modeling with the latest advances in artificial intelligence and machine learning to create a seamless algorithmic trading infrastructure. It is both optimized for real-world markets and highly adaptive to a range of different market conditions.

How does it work?

Alpha Hub sends signals to Arcade Trader to be converted into orders to be executed via the user’s brokerage account.

How much does it cost to run your Hedge Fund?

In order to run Arcade Trader with Alpha Hub, you need an account with both. The minimum for Arcade is the Advanced plan that is $19.99/month if you pay for a year (or $29.99/month if you pay by the month). Once you’ve got your premium plan set, you can purchase Alpha Hub signal with a 50% discount. The discount is available only after you upgrade the free Arcade Trader subscription to Premium. Alpha Hub's regular price is $200/month, so with Arcade Trader's 50% discount, it’s just $100/month. So the minimum to run a professional algorithm on your account is $119.99/month. This is enough to run one algorithm with a maximum of $30K investment. If you need to run multiple algorithms or multiple accounts or with amounts above $30K, then you will need the Arcade Trader Professional plan. Check out Arcade Trader’s price list.

Both Arcade Trader and Alpha Hub are subscription-based plans with a fixed price. This means there is no cut/percentage of your profit like with Hedge Funds. (Typically a hedge find earns a fixed 2% commission + 20% of your profit). An additional benefit is that with Arcade Trader + Alpha Hub, you can try for one or a few months to see if it really works for you before committing to a longer period. Hedge Funds usually require a multi-year commitment and a minimum investment of $500K, while with Arcade Trader there is no minimum threshold for investing.

Getting Started - 7 Steps

(1) Open an account with one of the supported brokers, such as Alpaca or Robinhood. Unfortunately, Robinhood doesn’t provide an API, so an unofficial API is used, and is future support is not guaranteed. If you already have a Robinhood account, you can start with this, however, for serious algo-trading, we suggest using Alpaca. If you already have an account with Alpaca, then you can use all or some of the money in the account for Algo-Trading.

(2) Deposit the amount you want to use for Algo Trading into your brokerage account. This step may take a few days. Check your broker for more details.

(3) Create a FREE account at Arcade Trader. During the setup, connect your brokerage account(s) and provide the authorization so that the Arcade Trader application can access your account and execute orders. Then upgrade to Advanced (max 1 algorithm and max $30K trading amount) or Professional (unlimited algorithms and trading amount) to start using Alpha Hub signals.

(4) In Arcade Trader, go under Setting/Signals to copy the 50% discount coupon code that you can then apply to purchase the AlphaHub subscription.

(5) Create an account on AlphaHub and then pay for your subscription by using the coupon you retrieved Arcade Trader in the previous step.

(6) In Arcade Trader, go under Setting/Signals and enter your AlphaHub email and password created in the previous step:

Enter Alpha Hub credentials under Settings/Connectors

Click on “Save” and you should be redirected to the AlphaHub Home page.

(7) Now click on the “Install an AlphaHub Strategy now” button on the top of the screen.

Install AlphaHub Strategy

And use this popup to install the strategy with a few clicks.

Set the algorithm
  1. Select the account where to install the algorithm. If you’re using the Alpaca broker you should have 2 accounts: Paper (virtual money) and Live accounts. Select the Live Account to trade the signal with your brokerage account.
  2. Select the AlphaHub algorithm you want to use. Check on the AlphaHub website to understand the information about each algorithm.
  3. Set the amount to use per trade. The suggested value is 100% Total Value (calculated as the sum of cash and equity in your account). This setting works well if you have a 2X margin or more, you’re using an algorithm that trades one stock per day (like “AlphaHub The Optimizer”) and you don't have other holdings.

Click on “Install” and you’re set. As soon as new signals are received from Alpha Hub for the algorithm you have selected, Arcade Trader transforms the signals into orders on your Alpaca or Robinhood account. Set it and forget it.

At the top of the homepage, you should now see the strategy has been installed correctly on your account with a summary of its configuration.

Algorithm Summary

If you want to change the algorithm, the amount to use, or you want to uninstall the strategy from your account, click on “Update” to modify your settings.

AlphaHub algorithms that trade one stock per day could send 2 signals at the same time: one to close the position opened in the previous trading day and one to open a new position. If you can access a margin of 2X or more this is not an issue, because buy and sell orders are usually filled in seconds or minutes and you’re going to use your margin only for a short time. Alpaca (and most of the brokers) doesn’t charge for margin interest if the margin is used on the same day. There are limitations to using a margin account. Please check with your broker about it.

From the Home page, you can monitor your accounts, your real-time profit, the open positions, and the most recent orders.

Arcade Trader Home Page

At the center of the Home page, you can find the Algorithm Activity. with all the details about the algorithm execution: when the signal was received, what kind of order was sent, filled order price and quantity, etc.

Algorithm Activity

If you click on any symbol enlisted in your Open Positions, a candlestick chart will be displayed (powered by TradingView). If you want to access real-time chart, bid price, ask price, and last trade price, then you need a separate subscription with Alpaca Data for real-time data.

Candlestick Chart

Conclusion

Advanced trading algorithms are no longer exclusive to investment firms, private hedge funds, and expert programmers. Thanks to AlphaHub, Arcade Trader users can now invest in stocks by subscribing to elite quantitative algorithms. This is the revolution you’ve been waiting for.

Investing is fun again.

NOTE: Arcade Trader is not responsible for the content of the signals received from AlphaHub. We suggest researching any Algorithms selected from the AlphaHub page before using them. Past performance is no guarantee of future results.

Useful Resources

Have fun with algorithms,

The Arcade Team

Disclaimer: This article is for academic purposes only. The author is not suggesting using a particular strategy or providing any financial advice. For more information, check our risk disclaimer.

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