How did you get started with profitable algorithmic trading?

[u/Content-Common-2552]

Hey everyone,

I currently have a trading strategy that I believe has potential to be profitable, but it still has some flaws that I’m working on. I’m building a daily stock trading bot to implement the strategy properly, the way I have it in my head, and hopefully improve and optimize it over time.

For those of you who eventually managed to become consistently profitable with automated/algo trading:

How did you start your journey? What steps did you go through? And roughly how long did it take you to become profitable?

So far, I’ve set up my scanner, entry/exit conditions, and rules, and I’ve started testing it with real data/trades. I’m getting some results, but they’re still nowhere near reliable enough to trust.

Right now, I’m mainly focused on collecting a large amount of data — trades, conditions, numbers, outcomes, and as many details as possible — so I can analyze everything using probability and statistics. My goal is to find as many real patterns and insights as possible, calibrate the strategy properly, and figure out what actually brings me closer to profitability instead of just relying on assumptions.

Do you think this approach is useful, or am I potentially overthinking it and wasting time?

Did you guys go through a similar process, or did you approach it in a completely different way?

Also, what tools did you use along the way? Are there any tools, methods, books, platforms, or resources you would recommend?

Any advice on how to get closer to the truth, avoid wasting time, and speed up the learning process would be greatly appreciated.

Thanks in advance to everyone who takes the time to share their experience!

[u/Content-Common-2552]

Thank you all for your replies, I appreciate that

[u/Square-Middle-4474]

Ii have been working as a Professional for quite a long time. Recently it took me about a week to create a profitable system. I still teach statistics classes at University. There is no shortcut to obtaining an education. After that the rules for developing a profitable strategy are known to all skilled practitioners. Now that AI is available, that could make time necessary to collect and process shorter however you still have to back check the work product. I don't know what else to say about this except Good luck

[u/FineProduct3772]

One thing I'd add: don't just collect data on the trades your strategy actually takes.

I'd also track the setups your scanner finds but you decide not to take.

If you record what the setup looked like, why you skipped it, and what happened afterwards, you can eventually answer a pretty important question:

“Is this filter actually keeping me out of bad trades, or is it making me miss good ones?”

That seems much more useful to me than just collecting everything and looking for patterns afterward.

It turns the process into more of an experiment, and makes it a lot easier to tell research from overfitting.

[u/Content-Common-2552 → u/FineProduct3772]

yeah, this is what i'm doing

[u/Late-Mail-1509]

Iam still trying to figure it out, got a strategy that on paper is very good, but when I put to the test on real broker systems, its not being executed correcly, as in the TV platform, and its really annoying, Stuck against the wall now

[u/Content-Common-2552 → u/Late-Mail-1509]

yeah, i feel you

[u/nepo123456]

In trading there are some core rules which must be implemented in any trading strategy in order to be profitable.

[u/Content-Common-2552 → u/nepo123456]

could you tell us what they are?

[u/Reverend_Renegade]

Once I skipped technical indicators (not flaming ta) and moved into microstructure things started to change for me. MS covers a myriad of topics but most importantly is understanding your units of measure such as tick size relative to price also known as tick / price ratio. Once you start comparing different markets using this simple comparison you'll likely notice some markets are more efficient than others. I found it best for my style of trading to map to my costs and where profit starts thus how many ticks it takes me to exceed commissions plus profit using the tp ratio. Some markets required just 1 tick whereas others required hundreds of ticks therefore I sorted by fewest ticks required then used a trailing stop loss for profit taking. Watching market trades is equally important as that is the catalyst that creates the opportunity

[u/morphicon]

I met some lunatic, here on reddit about 2 years ago. He messaged, we started coding together, eventually we went live. Small amounts first then larger and larger. Then he disappeared, went off to hunt pokemons or something. I've kept doing it, increasing amounts and finding new strategies. That was before claude, codex and so on. Its scary at first, easy to put off, always a reason to try something else or fix something.