Using Python for Trading Strategies

Python has gained a reputation as the language of choice for the development of a wide range of applications in the financial industry and has become a de facto industry standard for the research phase of trading strategy development. However, as with any other language or, better put, programming ecosystem, it has its advantages and disadvantages. So, as with any tool, it is essential to understand its strong and weak points to use the tool properly (not trying to hammer nails with a microscope, so to say).

In this chapter, not only will we consider using Python for algorithmic trading strategy development but we will also learn about the essential steps in the research and development process, discuss the difference between market modeling and event-based trading, and point to the mistakes most typically made in the research and development process. Finally, we will see the limitations of using Python for algo trading so our expectations always...