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THE ACCEL CORPORATION Building Algorithms for a better World

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The ACCEL Corporation

Building Algorithms for a better World

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Welcome to the Accel CorporationOur business is Creating Algorithmic Solutions to human problems.Using advanced mathematics with high resolution BIG data. Unveiling biases and errors in commonly-used Algorithms. Applying our proprietary algorithms to the marketplace.Building a Global Entrepreneurial Incubator. 2

An Application: Algorithmic TradingA current application of the Accel Corporation proprietary algorithms is automated trading of Equities.

Bringing high resolution Physics to Online Trading

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The Accel Algorithm analyzes every tick of thousands of stocks every trading day to determine whether, which, and when, to BUY and to SELL, based upon high resolution measurements and advanced mathematical equations designed to capture maximum profits .

The graph illustrated to the left is a plot of one day's price movement of a real stock trade. The vertical axis is the price in dollars, and the horizontal axis is the time of day in seconds beginning at the stock market open..

The Accel Algorithm made a virtual trade of this stock at $1.67 and again at $1.69 (the green dots). A little over 5 hours later it traded these shares at $1.97 each (the red dot) - an increase of $1.97 - $1.68 = $0.29 per share. That's a rise of 17% in just a few hours. A purchase of $10,000 at each of the two green dots would have returned a total of $23,400 when sold at the red dot, creating a profit of $3,400 in a little more than 5 hours.

These Pops are the main focus of Accels Algorithmic trading. There are numerous opportunities on an average trading day to capture such profitable gains.

The Accel Equity Algorithm2

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Overview: The Accel Equity AlgorithmTHE ACCEL COMPANY does automated trading of Securities using a proprietary algorithm.Created by a team experienced in the fields of physics, computer science, and Wall Street trading. Arbitrages rapidly changing Securities prices and automatically buys and sells, generally intraday.Works in both Up and Down markets; trading opportunities typically number several dozen daily.Eliminates human decision making and emotion in pulling the trigger-a major problem in trading.Runs at speeds and resolutions orders of magnitude higher than traditional Technical Trading. Signal detection uses precision measurements and tick level calculations (down to microseconds Not nano-trading). Strategy avoids competition from large Trading Houses who also do advanced Algorithmic Trading. Uses machine learning to analyze its own trades and adjust its current settings for optimal profit.

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HISTORY of ACCEL Equity ALGORITHMICSAccel Algorithmics is an automated Securities trading company founded in December of 2013 by Patricia Moore, in consultation with her husband, Wayne Moore, Ph.D., a theoretical physicist. They became interested in financial markets some thirty years before and became licensed in this field. In the mid 90s the Moores interest led to further advanced studies at the New York Institute of Finance. The tools and regulations for electronic trading have markedly improved in more recent times for individual traders allowing small trading firms like Accel to compete successfully with large trading housesThe Accel Corporation was formed in 2016.

This is a photograph of Dr. Moore taken in 2000 at NASDAQ s Times Square Headquarters in New York at an International Digital Trading competition.6

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What is Algorithmic Trading?By 2013 trading in the financial marketplace by individuals and small trading firms like Accel could affordably lease high speed computers and data storage. When combined with advanced mathematical models these tools make it possible to take advantage of differences in selling price and buying price occurring in the marketplace. These imbalances in pricing form arbitrage opportunities for traders buying low and selling high - over periods ranging from months or even years down to very small fractions of seconds. It is not necessary to trade at nanosecond frequencies however to be profitable. Technological advances over the last two decades finally made it possible for individuals or small groups of Quantitative Traders known as Quants to create Algorithms such as Accels to detect and capture favorable price movements at intermediate frequencies.

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What is Algorithmic Trading? (contd)The Accel Algorithm uses high resolution tick measurements which identifies features at the microsecond level - heretofore the almost exclusive province of large trading groups such as Goldman Sachs and J.P. Morgan Chase. This new level of precision possible today in modern algorithmic trading is summed up by Accels credo: In Math and Measurement We Trust. For more information about Quants, heres a link to a brief article: Quants: The Rocket Scientists Of Wall Street that explains what they do and what their qualifications are: Click Here for the Investopedia Article.Heres a link to a You Tube about Algorithms and how they are used extensively today, especially on Wall Street: Click Here for a TED TALK about Algorithmic Trading.

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Algorithmic Trading: a Quantum Leap FOrwardSome of the advantages offered by this advanced Quantitative Trading based on sophisticated mathematics and high resolution measurements are: Accel works in both up and down markets.Huge firms like Goldman Sachs, who also have sophisticated algorithmic trading programs like Accels, are not competitors. Reason? The stock price range that is most profitable for Accels strategies is generally smaller cap stocks that can make large price moves in a single day. Giant trading firms like J.P. Morgan Chase handle mutual funds and other very large pension accounts and are required by law to stay fully funded, i.e. when they sell off an asset, they must replace it. The sum of money involved is simply too large to be absorbed by these smaller cap stocks without the trading company actually becoming the market for that stock a losing proposition for a Trading House.9

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Algorithmic Trading is a Quantum Leap Forward (cont) Algorithmic trading eliminates human emotion a major problem that traders encounter - by automatically pulling the trigger.Firms such as AWS and Google lease processors and data storage systems on an as-needed basis, dramatically increasing processing speed, and lowering the cost of processing and data storage. This allows Accel to operate at the same level of computer performance and data management as the largest trading houses, at an affordable price, and with no inventory acquisition, maintenance and replacement costs. 10

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Algorithmic Trading is a Quantum Leap Forward (cONT) Accel takes advantage of leased processors and data storage systems to handle BIG DATA in the Terabyte range. Advanced mathematical/statistical techniques can be run on these leased machines to analyze the behavior of the markets at a more granular level than possible before for all but the largest Traders without the high cost that only these huge firms could afford in the past . Machine Learning is designed to continually and automatically search through the actual real time trading results, looking for the current best settings, and automatically resetting them for the next trading period a task that can only be done through high speed algorithmic processing.The number of transactions carried out in a given trading period is dramatically increased by automatically measuring , processing, and accounting for large numbers of trades.

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Accels Smart Algorithm Machine LearningAlgorithmic trading systems, if properly designed, offer the opportunity for the Algorithm to adjust automatically from past trading experience. In Accel, the Settings of dozens of parameters in the Rules are reviewed each week by the Algorithm itself to determine if it would have performed better had some of these Settings been at different values, and if so, these Settings are reset automatically. This level of optimization is not possible without high speed computer analysis. Accel uses this capability to insure that as the markets change the Algorithms Settings and Rules do too, thus continuing its automatic adjustments to the markets to optimize the Algorithms performance. This is crucial in ever-changing markets.12

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What Returns Can We Expect?Currently the average returns on backtests of Accels trades range between 1.5% and 2 % PER TRADE. Accel is designed to do multiple trades per day. On average there are 30 40 or more trading opportunities like this per day, 21 trade days per month, and 250 trade days per year. Over time Accels return % factor has been increasing incrementally as more advanced Rules are applied. For now, this % capture means that for a $10,000 trade the average return would be $150 -$200. At 10 such trades per day, before taxes, the gross profit average is $1,500 - $2,000 per day, or $31,500 - $42,000 per month roughly $400,000 per year without reinvestment. Larger dollar amounts per trade, and larger number of trades per day directly increase this figure. The Algorithm is designed so that it normally enters and exits trades of a given stock on the same trading day, thereby avoiding the risk of a fall in price that often happens when holding a trade overnight.13

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To put the trade of the Pop illustrated above in perspective, $10,000 purchased by Accel in a simulation grew to $17,391 for a net gain of $7,391 in a few hours.

Proprietary Algorithm

Accel's strategy is to capture in a single trading day a portion of the net rise in the price of a stock like the one illustrated here in August of 2015 in a meteoric burst from $0.17 to a high of $0.48. Accel entered this Pop in a test that day at 9:38am, 9:43am, and 9:46am EST at an average price of $0.23 and exited at 10:32am at $0.40 for a 73.91% gain in less than four and half hours on a down market day. 14

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The Algorithm started on the this white board in2013.Images of Accels DevelopmentThe following are images of the some of the people involved and some of the work that has gone into building Accel over the years:15

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ACCELALGORITHMICS

More whiteboard work.Which led to formulas, graphs and spreadsheets like the one below:16

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The ACCEL difference Thank you for taking the time to get to know Accel.

For more information contact us at:[email protected] 702-706-5755The Accel Corporation

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