Book Image

Python Algorithmic Trading Cookbook

By : Pushpak Dagade
Book Image

Python Algorithmic Trading Cookbook

By: Pushpak Dagade

Overview of this book

If you want to find out how you can build a solid foundation in algorithmic trading using Python, this cookbook is here to help. Starting by setting up the Python environment for trading and connectivity with brokers, you’ll then learn the important aspects of financial markets. As you progress, you’ll learn to fetch financial instruments, query and calculate various types of candles and historical data, and finally, compute and plot technical indicators. Next, you’ll learn how to place various types of orders, such as regular, bracket, and cover orders, and understand their state transitions. Later chapters will cover backtesting, paper trading, and finally real trading for the algorithmic strategies that you've created. You’ll even understand how to automate trading and find the right strategy for making effective decisions that would otherwise be impossible for human traders. By the end of this book, you’ll be able to use Python libraries to conduct key tasks in the algorithmic trading ecosystem. Note: For demonstration, we're using Zerodha, an Indian Stock Market broker. If you're not an Indian resident, you won't be able to use Zerodha and therefore will not be able to test the examples directly. However, you can take inspiration from the book and apply the concepts across your preferred stock market broker of choice.
Table of Contents (16 chapters)

Placing a bracket limit order with trailing stoploss

Bracket orders are complex orders that are meant to help to make a profit when trade becomes favorable, or limit the loss when it becomes unfavorable, with predefined values. A bracket order is essentially a combination of three regular orders togetheran initial order, a target order, and a stoploss order, which act together to help to achieve the specified profit or limit the loss. Along with the regular order parameters, a bracket order takes additional parameterstarget, stoploss, and trailing stoploss (optional).

Please refer to the introduction of the Placing a bracket limit order recipe for an in-depth understanding of the working of bracket orders.

You can use a bracket limit order if you want to place a buy bracket order below the market price or a sell bracket order above the market price. The trailing stoploss feature improvises the positioning of the stoploss order by modifying its price in the direction of...