Comment on The rise of Algo trading platforms & everything you need to know
commented on
11 Dec 2021, 02:54 PM
Below are some thoughts.
1. For tech savvy retail investors, allow pre-approved api with limitations like minimum margin maintenance, frequency of orders, max orders. Investor accountable for algo, service providers accountable for API services. APIs should have options to directly link with bank accounts. Any investment money should be frozen first to use for trading and then directly debited credited back to the accounts after trading is over. It may not be feasible to check and approve each modification in the algo in a short time.
2. For semi tech savvy retail investors, pre-approved open algos explaining how they work, no code or low code pre-approved platforms like streak. Investor accountable for using/making strategy, service providers accountable for services provided. Here services like Zerodha should also be there for manual operation.
3. For non tech savvy investors not willing to take any headache, proprietary service providers not requiring any approval for their algos, but instead accountable for providing minimum ranges of expected P/L conditions and mandatorily disclosing past performances.