Written by Michael Bigger. Follow me on Twitter.
Amazon.com operates at Web-Scale: fast, accurate, web-centric, networked, customer-centric, trustworthy, lower prices, etc.
Amazon.com removes friction from old business models and enjoys torrid growth rates because its model offers customers advantages they can’t ignore.
Can a trader remove friction out of his trading business?
Before I started a blog that discusses trading ideas and algorithms, I would jot down my ideas on paper, incorporate some in our algorithms, and then stack them in a filing cabinet. The ideas never saw daylight again. They were stuck in the mud.
A year ago, I freed these ideas via this blog. I decided to put them out there and see what happened. Over one year, traffic to the blog increased more than 20 times. The blog has allowed me to start insightful conversations (some…profitable) with some great traders. There are many other benefits as well, all of them being the results of lowering friction.
How do you remove friction from your trading business and run it at Web-Scale?
Let me give you an example. I enjoy reading technical chartist Greg Harmon (Great Stocktwits Participant, worth a follow). Greg produces a torrent of charts on a daily basis—so many of them that I can’t keep up. Recently, I asked him to include his charts and trading signals in a shared Google spreadsheet. Google has quote functionality embedded in its spreadsheet. The laziness in me just wants to wait for Google to trigger an alarm when, according to Greg’s thinking, a stock price reaches a critical level. Using an API framework would remove even more layers of friction.
Running a trading business at Web-Scale should allow you to turn that “One Good Trade” into multiple “One Good Trade” to generate bigger trading profits.
These are some of the tools I use to remove friction from my trading business (in no particular order):
1. Moving from one-on-one discussion to one-to-the-world discussion: Connect using Stocktwits and Twitter. If the information is valuable, the ants will pick it up! You are the catalyst. Learn from the best traders.
2. Application Programming Interface (API): Expand from trading a few securities in the United States to trading thousands across the globe. Bigger Capital uses the Interactive Brokers Java API: Kick Ass!
3. Your own media property: Start your own blog. Put your ideas and thesis out there. Seek feedback.
5. Capturing and storing trading ideas: Use Evernote to track information so you don’t have to remember it.
6. Cloud database: Lose the paper by employing OfficeDrop and Amazon S3.
7. Pre-built algorithms and sandbox: Test out the Scale Trader and Accumulate/Distribute algorithms on the Interactive Brokers platform. This is the best tip of this post. Thanks for reading this far.
I hope you discover many more. Let me know.
Recommended Reading: One Good Trade: Inside the Highly Competitive World of Proprietary Trading (Amazon Affiliate Link).