Dato’ Dr. Nazri Khan, MSTA, CFTe

President, Malaysian Association Technical Analyst (MATA)
Vice President, Affin Hwang Investment Bank
Kuala Lumpur, Malaysia

Profile

Dato’ Dr. Nazri Khan is an Economic & Finance degree graduate of the University of Manchester, a licensed equity analyst with international retail experience, conducting over 1000 retail investment functions in Malaysia and overseas. He is currently the Vice President, Head of Retail Research in Affin Hwang Investment Bank Bhd and is a Full Member Of The UK Society Of Technical Analyst. He has been in retail trading industry for sixteen years and is currently the President of Malaysian Association Of Technical Analyst. Prior to Affin, he was the Chief Technical Analyst and Head of Research in MIMB Investment Bank as well as sit in Dewan Perniagaan Melayu Malaysia as a board member. He is widely followed in the social media and has been a weekly stock market commentator in Malaysian local and foreign mainstream media. Finally, he is a PhD holder from Multimedia University, Cyberjaya and is a Certified Financial Technician affiliated with International Federation of Technical Analyst.


Presentation Abstract

AUTOMATED ROBOTIC TRADING SYSTEM : THE NEXT TECHNICAL ANALYSIS EVOLUTION WHICH APPEALS TO THE NEW GENERATION OF TRADERS

Robotic Trading Systems is an automated stock trading software which use a combination of programmed technical analysis and quantitative analysis to produce automatic rules for trading. Robotic Trading System is the latest form of artificial intelligence using alternative finance that is capable of following the whole world markets, executing a user-defined trading strategy continuously and instantaneously without user intervention. The robotic trader acts as a trading surrogate to monitor complex stock market indicators and other conditions affecting trade outcomes. The ability to trade in stealth mode, ins and outs intermittently, is also a key distinction between automated and manual trading systems. Robotic trading software has grown in popularity through partnerships with leading industry firms in the USA including TD AMERITRADE, ETRADE, MB Trading, Trade King, OptionsHouse and TradeStation.


Robotic Trading System will combines an arsenal of powerful stock trading tools in a user friendly format which allows anybody well versed in Technical Analysis to operate without a programming knowledge. It can be fitted with different trading templates geared to different types of stock trader based on their aggressiveness. It uses a sophisticated stock filtering program that allows trading investors to filter through all NYSE, NASDAQ, and AMEX stocks for those meeting their investment criteria using price, exchange, and volume and other sophisticated technical indicators. Best still, the latest technology of this robotic trading provides a Real-time Market Simulator using comprehensive Technical Analysis adaptive rules which can learn from trading mistakes and errors as humans did. Robot system will do its own technical analysis, money management rules and enter trade orders in the place of a human trader. They are programmed to generate returns by the application of adaptive technical rules which are decided by their creators. In other words, the intelligence and skill of a robot is entirely dependent on its creator. The robots run the pre-programmed routine under all circumstances and adapt it to changing conditions in the market, but will attempt to cut losses based on the optimized instructions provided to by the programmer. Theoretically, it can be used to trade the whole world namely 100,000 stocks, 500 commodities, 180 forex pairs, 1000 bonds and a million of options worldwide.

There are two important problems with the logic behind the creation of the automatic trading robots, and the actual results generated by them. The first and obvious issue is the fact that the robots normally have never been tested in actual market conditions. In almost all cases, they are tested on historic data, and non-trade related problems, such as connectivity issues, or problems that originate from the broker which would not be reflected on market data, are ignored. The second issue is born of the fact that by using an automatic trading robot, traders are basically handing over the control of investment to a machine that has no brain. It is programmed to run according to a set of rules at all times, and has no ability to adapt itself to changing circumstances, regardless of the severity and importance of the changes in question. In short, the automatic trading robot is an alluring, great idea that promises a lot of efficiency and appeal to the new generation of traders in the financial markets. Finally, it is my belief that automated trading software is ideally suited for gadget social media based traders, Gen Y and Gen Z which makes up 20% of the current global population.