Algorithmic Trading Engine Interface for Trader Control
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Solution Overview
Problem
Algorithmic trading systems lack intuitive interfaces, leading to trader discomfort due to complex algorithms and lack of control, resulting in inadequate performance and loss of market insight.
Innovation Solution
A graphical user interface with automated algorithm selection and real-time feedback enables traders to initiate and manage complex trading strategies through drag and drop motions, providing visual indications of market impact and order executions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If complex algorithms are used for automated trading, then trading efficiency is improved, but trader control and understanding are reduced
Solution Approach 1:
The patent introduces an intermediary layer between the trader and the complex algorithmic trading system. This intermediary provides a simplified user interface that translates trader intentions into algorithmic actions while presenting simplified feedback to the trader. The intermediary maintains the complexity of the trading algorithms internally while shielding the trader from this complexity, thus preserving both trading efficiency and trader control.
2Object-generated harmful factors
If algorithms are made opaque to prevent information leakage, then market impact is reduced, but trader visibility and feedback are lost
Solution Approach 1:
The patent applies local quality by differentiating between internal algorithmic operations and external trader interface. Internally, the algorithm operates with full complexity and opacity to prevent information leakage. Externally, the system provides localized, simplified information to the trader through the user interface, showing only the essential feedback needed for trader awareness without revealing the underlying algorithmic logic. This resolves the contradiction by applying different levels of transparency in different contexts.
3Ease of operation
If simplified user interfaces are provided, then ease of use is improved, but information completeness is reduced
Solution Approach 1:
The patent creates a simplified copy or representation of the complex market data for display to the trader. Instead of presenting raw, complex algorithmic data, the system generates simplified visual representations such as charts, graphs, and key performance indicators that capture the essential market dynamics in an easily understandable format. This copying approach maintains ease of use while preserving the critical information traders need.
Data Source
AI summary
An exemplary embodiment comprises: (a) receiving electronic data describing a trading order; (b) selecting one or more first trading algorithms from a plurality of available stored algorithms for execution of the trading order; (c) commencing execution of the trading order via the one or more first trading algorithms; (d) evaluating quality of execution, during the execution, of the trading order via the one or more first trading algorithms; (e) comparing the evaluated quality of execution to a threshold of acceptability based on a prediction of future performance of execution of the trading order by the one or more first trading algorithms; and (f) if the evaluated quality of execution compares unfavorably to the threshold of acceptability, switching the execution of the trading order to one or more second trading algorithms, wherein the processor unit comprises one or more processors.