The Construction And Applicationresearch Of Program Trading Model Based On Channel Breakthrough Thinking

To get excess returns is always the ultimate wishfor all the investors. If you want to tradewith an effective ways, it is necessary to rely on a set of effective trading strategies, either fundamental analysis or technical analysis.In fact, has its inherent theory. Program trading is the quantification of the investment strategy, and executes the strategy by the computer. In developed markets, program trading is the most powerful method for either individual investors or large institutional investors.Program trading can find trading opportunitiesin complex and disorderly price fluctuations. In financial markets,the price usually continues the previous movement until the end of this stage of market direction. This characteristic is defined as the trend, and the existence of the trend can provide ideas for designing the trading model.Program trading was first defined as a one-time transaction for trading portfolio contains a dozen of stock. The rising of program trading started in1970. After a long period of development, with the improvement of computer platforms and trading ideas, program trading has anew definition, the investors design thetrading strategy first, then they send the model into computer, the trading platform will automatically execute the trading operation.As we all know, in the process of securities transactions, the investor’s individual psychological factors and a large number of confused information have a fatal impact on the transaction of investors, many investors are good at analytical analysis, but after theyestablish positions, they usually can’t make right decisions.Program trading can completely avoidthis situation, because the computer doesn’t care about the psychological factors.This paper attempts to design a system to makeprofits. The model should fit for some kinds of products, such as rubber futures and PTA futures.Amature model should get positive returns in the two markets. As we know, if a trading strategy can maintain its vitality in a long period, this model would be valuable. In the process ofa model design, it is worth thinkingfor how to deal with these issues. Articlesabout program trading model designarevery few. The strategiesin these papers are very simple, such as MACD, KDJ system. The purpose of these papers is to verify a positive return. But they don’t test the equity curve, drawdown rate, loss ratio, trading winning rates. The test period isalso limited.In this paper, we consideredthe above problems, and we will verify the effectiveness and profitability of the trading model basedon channel breakthrough thinking.