We spoke with Viktoria Dolzhenko, an expert with over a decade of experience developing complex systems, about her new book, Algorithmic Trading Systems and Strategies: A New Approach: Design, Build, and Maintain an Effective Strategy Search Mechanism. She shared with us five valuable tips from her extensive knowledge. Viktoria is a Team Lead at Itez and a member of the prestigious International Association for High-Density Systems (IAHD) and the Institute of Electrical and Electronics Engineers (IEEE), highlighting her expertise and credibility in the field. Additionally, she has been a reviewer for the book ".NET in Action, Second Edition" by Dustin Metzgar, published by Manning. This article will be handy for those looking to develop, optimize, and maintain their algorithmic trading systems, providing insights to help beginners and professionals enhance their trading strategies.

First Tip: Embrace a Comprehensive Approach to System Design

Viktoria Dolzhenko stresses the importance of a comprehensive approach when designing algorithmic trading systems. Instead of focusing only on the implementation stage, she advises understanding and planning every step, from the initial idea to the final operation. This thorough approach ensures that each part of the system works together smoothly, creating a robust and scalable trading system that can adapt to market changes and technological advancements.

In her book, Algorithmic Trading Systems and Strategies: A New Approach, Dolzhenko guides readers through this process, emphasizing the potential pitfalls of overlooking any stage. For instance, a system designed without considering future scalability might perform well initially but struggle as the trading volume increases. Similarly, neglecting the integration of different components can result in inefficiencies and errors that could have been avoided with a more holistic design approach.

"Understanding every aspect of your trading system is crucial," says Dolzhenko. "It's not just about writing code or implementing a strategy; it's about creating a cohesive, efficient, and adaptable system. This means considering how each component interacts with others and planning for future growth and changes."

Second Tip: Leverage Microservice Architecture for Scalability

Victoria Dolzhenko advises adopting a microservice architecture for building trading systems, allowing for the independent deployment and scaling of different system parts. This approach enhances flexibility and resilience, which are crucial in the dynamic trading environment. Dolzhenko's guidance, detailed in her book, emphasizes the benefits of horizontal scaling. By distributing workloads across multiple services, traders can handle more data and execute more strategies simultaneously. This scalability improves efficiency and profitability.

"In simpler terms, imagine each function of your trading system-like data processing, order execution, and risk management—as a separate, specialized team," says Dolzhenko. "Each team can work independently, making changes and improvements without affecting the others. This flexibility allows for quicker development and deployment of new features."

Victoria's advice underscores the importance of adaptability in trading systems. Markets change rapidly, so independently scaling different parts of your system can help you respond quickly to new opportunities or threats. Traders can build more robust, efficient, and profitable systems following her guidance.

Third Tip: Implement Robust Monitoring and Continuous Integration

To maintain an effective trading system, it's crucial to prioritize robust monitoring and continuous integration (CI) practices. Monitoring, like using Kubernetes, helps track system performance and quickly address issues. CI automates testing and deployment, ensuring updates integrate smoothly and reducing errors and downtime. By being vigilant and proactive, traders can sustain optimal performance and adapt to market dynamics. Victoria Dolzhenko advises, "Monitoring and CI are like having a watchful eye and a well-oiled machine. They ensure your system is healthy and agile, ready to navigate the fast-paced world of trading."

Fourth Tip: Focus on Strategy Diversity and Optimization

Dolzhenko suggests a new perspective on trading strategies in her book, challenging the traditional focus on a few high-performing ones. She argues for a system that analyzes and optimizes thousands of potential strategies, aiming to increase the chances of finding profitable opportunities and enhancing adaptability. This approach involves setting up a strategy search mechanism that continuously evaluates and refines strategies to stay in line with market conditions. Dolzhenko emphasizes the importance of diversification and ongoing optimization, suggesting that traders can achieve more consistent returns by refining and diversifying their strategies.

Victoria says: "My approach highlights the dynamic nature of markets and the need for traders to evolve their strategies continuously. By constantly seeking new opportunities and refining existing ones, traders can adapt to changing market conditions and improve their overall performance."

Fifth Tip: Prepare for the Rigors of Book Writing and System Development

Viktoria kindly shared with us her difficulties, from overcoming initial doubts about becoming an author to the meticulous and prolonged effort required to complete her manuscript.

"The most challenging aspect of starting to write this book was, in fact, the act of beginning," says Dolzhenko. "I always felt that being a book author didn't align with my identity. When I submitted my manuscript to Apress, I was filled with apprehension. However, much to my surprise, the editor and reviewers were impressed with my work. I felt inspired once my submission was approved, believing I could easily and swiftly translate all my thoughts onto paper. Yet, as is often the case, reality diverged from my expectations. Writing a book proved to be a demanding and arduous daily endeavor. It is a marathon, not a sprint. To those considering embarking on their book-writing journey, I would advise keeping this in mind and preparing accordingly."

In Algorithmic Trading Systems and Strategies: A New Approach, Viktoria Dolzhenko shares a wealth of insights acquired from more than ten years of experience developing intricate systems. Her book is an essential resource for anyone looking to design, build, and maintain effective algorithmic trading systems, offering innovative strategies and practical advice to navigate the challenges of this dynamic field.