The Striker Report - gold standard for objective trading research

Tom Leeson

Founder and Managing Director MicroTrends Ltd.

Interviewed by John F. Gallwas - Founder of Striker Securities, Inc.

Tom Leeson started MicroTrends in 2006 to help traders develop trading tools, indicators and automated trading strategies. The company has focused solely on users of the NinjaTrader platform since 2009. NinjaTrader is one of the platforms offered to traders by Striker.

MicroTrends's customers - including individual traders, system vendors, system designers, trading educators and CTAs rely on MicroTrends to help them define their trading ideas, concepts, and strategies, and then to turn these into effective, working NinjaScript code for manual, semi-automated, or fully-automated online trading.

MicroTrends was one of the first "NinjaScript Certified Consultants", and remains a member of this select group of first-tier NinjaScript specialists (and the only group member located outside the US). MicroTrends is based in East Sussex, UK, about 50 miles south of London.

John Gallwas: Define the function of "NinjaTrader" and what are the services MicroTrends perform for traders and system developers using the Ninja platform?

Tom Leeson: NinjaTrader is a trading platform that provides free advanced charting, market analytics, and simulation, and also tools for development, backtesting and optimization. NinjaTrader gives traders easy access to trading related technology that was only a remote possibility just a few years ago.

Where does MicroTrends fit in? We help traders to define their trading ideas, concepts and strategies, and then to turn these into the NinjaScript code they need for manual, semi-automated, or fully-automated online trading. MicroTrends offer traders a complete trading system consultancy and development service. We can help create systematic discretionary systems that are semi, fully-automated algorithmic trading strategies. We also convert indicators or strategies to NinjaScript from other platforms (e.g. CQG, eSignal, FXCM Strategy Trader, MetaTrader, MultiCharts, ProRealtime, Strategy Runner, ThinkOrSwim, TradeStation, TT X_Trader AutoTrader , etc), help research and investigate trading ideas, or develop specialist, bespoke trading tools for use with NinjaTrader.

We either use the "vanilla" NinjaTrader technology and platform, or work with our purpose-built MicroTrends NinjaTrader algorithmic trading frameworks. These frameworks enhance the base NinjaTrader platform, so as to "up the game" for each trader, to provide a higher level of out-of-the-box signal execution, order management, risk and money management, and advanced trade management, with all with advanced user interface controls. And traders with coding experience can also use our frameworks as an enhanced coding platform to create powerful strategies and tools that - for example - allow an optimized focus on entry and exit rules in just a few lines of code.

John Gallwas: Tell us about your background.

Tom Leeson: I started in computer hardware in the early 1990s, and switched to software in 1994. From 1996 - 2006, I worked commercially as a contract developer in "the City", London's financial center, mainly in the trading arena. Projects were varied, but mostly institutional enterprise-level commercial software development projects, for example an Excel VBA equities trading system for Goldman Sachs, and also some of the very first online retail stock trading websites set up by investment banks (online trading was very cutting edge at the time -costing many millions to implement!). Along the way, I gained considerable software experience related to trading equities, FX, and futures, and spread betting, too. One of my last projects at this time was re-writing and optimizing part of a global, interbank, commercial-payments-and-money-market platform. My task was to reduce latency by tenfold, increase trade throughput and reduce back office processes. The system needed to handle individual trade sizes often of $150 million or more; so there was considerable pressure to get it right with no room for error! The platform could easily have taken down a bank if it had gone wrong... And by the way, I'm no relation to Nick Leeson, who actually did take down a bank!

John Gallwas: What led you to the founding on MicroTrends in 2006?

Tom Leeson: The Sarbanes-Oxley Act of 2002 introduced "red tape" which made life a lot less fun as a financial sector contract software developer. Suddenly a 5-minute job took 1-week due to new bureaucracy! Also, I couldn't help noticing that the adoption of C# technologies was increasingly wide-spread in all spheres, and also that the retail trading sector was suddenly developing at a fast pace due to cheap, high-speed internet access, data feeds and retail trade platforms. I made a decision... instead of staying in the City (with its red tape ... and a daily commute in the rain!), I chose to harness together my passions for software development and trading in a new venture. So, MicroTrends was born... and continues to be the most enjoyable and fulfilling experience of my career.

John Gallwas: Why did you switch your focus solely to NinjaTrader in 2009?

Tom Leeson: Initially, we focused on various systems - from CQG, to APIs, and various others. Following an extremely expensive series of live trading tests with CQG, we initially resolved to build our own trading platform and algorithmic framework (with a simulator and analyzer) to allow us to develop and rollout out trading strategies rapidly. We then discovered that NinjaTrader had already provided the base for all of this, in addition to fantastic charting and indicator tools, and also a complete C# strategy library (i.e. NinjaScript). So, we changed tack and teamed up with NinjaTrader, and also began to provide off-the-shelf MicroTrends indicators and strategies for NinjaTrader, as well as an "algo" framework to extend NinjaTrader's base functionality.

NinjaTrader is a fantastic platform, for traders and developers alike, and not just because it's free!

John Gallwas: Are there special skills or experience that separates MicroTrends services from others?

Tom Leeson: We are a Certified NinjaTrader consultant. Therefore, we are vetted and assessed. On top of this, we have an experienced team that has worked on many varied systems in the past, such as Legacy, Client Server, "N" Tier SOA systems. We now offer our proven experience of methodology, architecture, quality and trading to clients in the retail trading arena.

Uniquely, we also offer a focus on the quantitative development of algorithmic trading systems; what could make a specific trading system better, how to approach various aspects of strategy research, design and testing. Also uniquely, we're the only company providing a framework for traders to add out-of-the-box functionality into their own strategies.

Our lightweight, incremental and iterative software development methodology (sorry, that's a mouthful!) is also a big strength, particularly for customers with loosely defined concepts they want our help exploring in a low risk manner. This approach is adaptive, logical, and flexible, and offers maximum transparency and control with the least cost, risk and delivery time. We use it for the smallest 2-hour projects with simple, well defined requirements, and we also use it for the longer, larger, more complex and/or partially defined projects.

John Gallwas: Do you see any changes in the markets (regulatory and/or fundamental) that could require an update of trading systems in order to maintain profitability?

Tom Leeson: Markets change the whole time (what made $1,000,000 last year is a loser this year!), so systems need to be designed with a generic, adaptive implementation, so that they can re-configure, re-optimize or simply adapt to changes in volatility or daily volume and ranges. So, an adjustable parameter set allows a trader to do this. This approach is all that is needed in most cases providing system diversification -without the extra cost of developing a new system.

One challenge now is the increasing use of technology to do the same tasks a trader once did adequately sitting in front of a screen, reading charts and clicking a mouse. Now, it's imperative to automate much of what was once done manually; with technology to help you can scan more markets at a time, for more hours in a day (without getting tired or losing concentration), and move more quickly and consistently when the markets give you an opportunity.

John Gallwas: Are there any new software developments that could improve the performance of trading systems?

Tom Leeson: We are working on a number of projects in interesting areas. For example, incorporating adaptive intelligence into an expert system, and also inter-process communication (both locally and over the internet). This would allow a trader to orchestrate a system (or system network) to collate data, weight it, process it, and then send the processed information on to satellite, autonomous trading systems to use in their own specific market. It looks like this will offer a sophisticated and time saving approach to finding out what works and what doesn't, and when to use it, and could help for predicting price cycles and conditions, and for adapting and evolving with the market.

This interview is for informational purposes only and is not intended to be a solicitation of any kind. Trade only with risk capital. The risk of trading can be substantial and each investor and/or trader must consider whether trading systems are a suitable investment.