The Trade Ideas Story
We founded Trade Ideas in 2002 after an experience we now affectionately call the $50 million education. In 2000 we were part of a venture capital financed effort to bring direct access trading technology to hedge fund managers. It turned out that rather than helping us nurture and grow the business, technology, and vision, our venture capital partners taught us exactly what not to do, to the tune of $50 million. Looking back in hindsight, it was the best thing that ever happened.
Why We Made Trade Ideas
In our previous venture we had the good fortune to meet and build relationships with very knowledgeable players in the business of investing and trading. We learned that access to high-touch information makes all the difference between success and failure.
Investing and trading are difficult enough. And the amount of data out there for an investor or trader to look through makes it even harder to find any kind of an edge. Trade Ideas software was created to be that edge - the difference between success and failure. Our technology accomplishes what no human can do. And that is to watch each and every trade of every stock in the markets and notify our customers about unusual activity so they can be the first to act.
That was how we got our start in 2002 by catering mainly to professional traders, active traders, and hedge funds.
What Customers Really Want
Anyone involved in the markets is there for one reason, to make money. And that is exactly what we help our customers accomplish with greater efficiency.
The Other Side
Imagine for a moment that you want to play professional basketball. Do you really think you could compete against the likes of Kobe Bryant? Or if you decided to be a professional golfer, do you think Tiger Woods would be in any danger? Probably not.
Yet, every single day there are new individual investors entering the markets. And the markets are an environment filled with highly skilled professionals at every level. If you are a new investor, you are literally swimming with sharks. There are people and organizations with better information, more money, and faster computers all around you. Investors still have the idea of making consistent money, but most forget that whenever they are buying or selling there is someone taking the other side of the transaction. Somebody is always betting against you.
Old School Guessing
It's 2012 now, and still every single charting software package is littered with ideas that are decades if not hundreds of years old. Long ago when we were researching which features to add to Trade Ideas, technical analysis indicators and Japanese candlesticks were no brainers. Everyone has either heard of them or believes they provide value. So, we created our software to find these traditional patters in real-time. Trade Ideas easily identifies overbrought and oversold, daily and intraday RSI, Stochastics, MACD, and many more. There was no problem at all finding these setups in real-time.
However, we noticed a problem when looking to see if these traditional setups had any true predictive value. The results were clear. By themselves, these traditional technical indicators and candlesticks are no better than a coin flip. The same can be said about patterns such as "double bottoms," "head and shoulders," "wedges," and "cup and handles." These patterns do occur from time to time, but when you see them they are almost as likely to go one way versus another.
When you make decisions based on this type of data alone, you are guessing.
Why use Trade Ideas
We make the computers in our datacenters act like traders by playing thousands of trading scenarios every single day. Much like IBM's Watson, our computers are constantly learning which market relationships have predictive outcomes.
Our software identifies what is working in a down market or in an up market, and suggests exactly what to buy or short and when to exit. Trade Ideas does all the number crunching grunt work at our datacenters allowing our clients to be the CEO of their financial empire. The CEO doesn't pour over spreadsheets, that's for accountants and statisticians. CEOs make decisions and puts capital to work.
Trade Ideas Today
We're nearing our 10th year in business and now cater to investors, traders, and market professionals in over 65 countries. Both Scottrade and E*trade license Trade Ideas technology for their premium trading platforms to help their engaged customers get the most out of the market. We have fully automated trading available through TD Ameritrade, Interactive Brokers, and Sterling. Professional market making firm Knight Capital uses Trade Ideas technology all throughout their trading floor to help their traders see where the most important action is taking place. We work directly with NASDAQ as partners for one of their proprietary data feeds.
Today, we not only watch all US and Canadian stock exchanges but we also look at options data and unstructured data including social media to uncover even more predictive relationships. Many educators like TodayTrader, Bulls on Wall St., and TradeCrushers use Trade Ideas as part of their education curriculum to teach students market dynamics. Bloggers and portals use our dynamic data widgets to make their communication platforms more engaging to their readers.
The market is just starting to catch on to what Trade Ideas technology has to offer and we could not be more excited about the future of our business!