This trio is taking algo-trading from stock market biggies to the common man

This trio is taking algo-trading from stock market biggies to the common man

Tuesday February 06, 2018,

5 min Read

Taking complex equity trading solutions to mobile apps, Streak aims to ignite every trader’s equity portfolio. 

To create an algorithm-based equity trading platform, one needs to know to code, and for algo-trading one needs to have large trading volumes and a huge portfolio. This was the state of affairs at first, but now, not anymore.

“For a common man, technical indicators (for stocks) are difficult to code in because you need to understand not just how the market works, but also have knowledge of programming languages like Python,” says Harsha Manohar, co-founder of Streak.

And that’s where Harsha and the founders of Streak saw their opportunity to start up.

Harsha Manohar, Vipul Divyanshu and Jayalakshmi Manohar have worked together for six years now. Their first venture was a virtual dressing room app, TrialKart, which was acquihired within six months of its existence by online marketplace Voonik in August 2015.

The founders of Streak (L to R): Jayalakshmi Manohar, Harsha Manohar and Vipul Divyanshu

Being an active investor in the stock market since 2011, Harsha often wondered how he could add value to the process of trading. Explaining how stock trading works to Vipul and Jaya gave him some answers.

What started as discussions in July 2017, was incorporated as Streak in August 2017.

So, what does Streak do? 

Typically, stock traders remain glued to their trading screens to buy and sell stocks as the market moves. For volatile stocks, or in a volatile market, this focus has to be sharper.

Rather than doing that, Streak claims to be among the first few platforms in the world where traders can create algorithms to generate trading signals for buying or selling stocks without the need for coding. The platform also allows traders and customers to check the profitability of the trade.

Another issue that traders face is that many map only two to three stocks at a time. Streak allows traders to track as many as 50 stocks at any given time.

How does it work?

A customer, using Streak, can create an algorithm for buying and selling action in 45 seconds for a stock if it reaches a certain price by keying in indicators like stop loss, target profit percentage, and the stocks to be traded.

Customers can initiate an action to back-test the algorithm based on relevant historical data before risking any actual capital. It is important to analyse profitability, and the risk, before taking any trade call, in order to gain insight into the effectiveness of a trading idea.

Traders can also keep the trading position over the coming weeks to see how their stocks would perform if they took a particular trading logic. The last part of the process is the actual deployment of the algorithm.

Streak bots track stock movements and send one-click actionable alerts on traders’ phones to confirm the action when strategy conditions are met.

Currently, still in the beta stage, the platform is readying for a full launch with Zerodha in April. Streak will be available to customers at Zerodha’s trading app, Kite. Says Harsha,

“At present, we have 20 technical indicators tracked on the platform. Based on the feedback we have been getting, we will be adding 20 more technical indicators and launch it in May.”

“Taking Relative Strength Index indicators of stocks, the platform notifies the user to take action on the signals generated,” he adds. The Relative Strength Index helps traders understand whether a stock is in the overbought or oversold territory.

Stacking up

Even in its closed Beta stage, the platform is seeing close to 10,000 back-tests a day. The company has received funding of Rs 2.25 crore from Rainmatter, Zerodha’s startup fund and incubator. Being a B2B2C solution, the five-member firm is also underway to sign its service with top banks in the country.

In the coming months, the firm is also planning to onboard other traders on to the platform. In six months, Streak plans to launch its mobile app where customers can choose their final execution broker as well.

Looking into the future, Streak plans to add 1,000 clients and customers every month, while looking to reach at least 50,000 backtests and 5000 deployments every day by June.

The founders haven’t yet decided on the enterprise pricing. For individuals, customers will be charged Rs 500, plus tax, for 3,000 back-tests and 50 deployments. Customers can, however, get a free trial for seven days. This will include 25 back-tests and five live deployments.

In August last year, the Finance Ministry had stressed for necessary safeguards to prevent disruption of the equity market, and media reports said Subhash Chandra Garg, Secretary, Department of Economic Affairs, had stated ‘algorithmic trading gives “unequal access” to institutional investors over their retail counterparts as they have access to speed and co-location’.

Recently, it was also reported that small brokers would get equal access to algorithmic trading as their bigger peers as the Securities and Exchange Board of India was planning to ask exchanges to cut down the co-location charges that brokers have to pay.

Streak competes with Gurgaon-based algo-trading platform Kuants, which raised around Rs 50 lakh last month from Delhi-based angel investors Pankaj Chopra and Ankush Gupta.