When any kind of trading "works", meaning it generates alpha above and beyond the market, you won't hear about it. Why would anybody give away their secret sauce?
Some people talk. I've been watching some of Lance Breitstein's videos. He made $100m trading but got stressed by it and figured he has enough money so now is teaching and the like https://www.youtube.com/@TheOneLanceB
I think at the moment AI trading probably works a bit but the public stuff on youtube I've come across is terrible. On the other hand Quadrature Capital paid all their staff £2.8 million bonuses because they had so much money rolling in. Google's thing says they are a "secretive London-based, AI-driven quantitative proprietary trading firm".
To sell the bot itself. Say I have a bankroll of $10,000 to work with. Say I can generate 20% per year on it. That's $2,000. 20% is good, but on $10k, that's not much. If I borrow money, then that cuts into my margins. If I sell access to the bot and charge other people, they get, say 15% and I get some flat fee and 5% of however much they invest, so some such.
That secret sauce isn't going to last forever. Jan street's gonna find your alpha and leave you with none, so monetizing sooner rather than later is advantageous.
Yes, more profitable for the bot operator, given the available capital to deploy.
But it doesn't follow that the bot wasn't working in the first place. Although there are many bots for sale that are indeed not working.
When any kind of trading "works", meaning it generates alpha above and beyond the market, you won't hear about it. Why would anybody give away their secret sauce?
Some people talk. I've been watching some of Lance Breitstein's videos. He made $100m trading but got stressed by it and figured he has enough money so now is teaching and the like https://www.youtube.com/@TheOneLanceB
I think at the moment AI trading probably works a bit but the public stuff on youtube I've come across is terrible. On the other hand Quadrature Capital paid all their staff £2.8 million bonuses because they had so much money rolling in. Google's thing says they are a "secretive London-based, AI-driven quantitative proprietary trading firm".
To sell the bot itself. Say I have a bankroll of $10,000 to work with. Say I can generate 20% per year on it. That's $2,000. 20% is good, but on $10k, that's not much. If I borrow money, then that cuts into my margins. If I sell access to the bot and charge other people, they get, say 15% and I get some flat fee and 5% of however much they invest, so some such.
That secret sauce isn't going to last forever. Jan street's gonna find your alpha and leave you with none, so monetizing sooner rather than later is advantageous.
wouldn't you only "sell the bot" if that was more profitable than operating it yourself though? in that case, i'd say the bot wasn't working.
Yes, more profitable for the bot operator, given the available capital to deploy. But it doesn't follow that the bot wasn't working in the first place. Although there are many bots for sale that are indeed not working.