---
title: Algorithmic Trading
description: Algorithmic trading uses computer programs to execute trades based on defined rules and formulas. You will understand how to design, backtest, and implement automated trading strategies using historical data, programming languages, and API integrations.
category: finance-economics
subcategory: investing
difficulty: beginner, intermediate, advanced
url: /subject/algorithmic-trading
---

# Algorithmic Trading

Algorithmic trading uses computer programs to execute trades based on defined rules and formulas. You will understand how to design, backtest, and implement automated trading strategies using historical data, programming languages, and API integrations.

## Available Resources

2 Books • 3 Websites

## Websites

### 1. Backtrader

Open-source Python framework for backtesting and live-trading strategies, documented with worked examples covering data feeds, indicators, brokers, sizers and analyzers. After working through it you can code a strategy, run it over historical data and read the performance statistics.

**Difficulty:** Beginner | **Price:** Free

**Link:** https://www.backtrader.com/

**Tags:** backtesting, python, trading-strategies, open-source, quantitative-finance

### 2. r/algotrading Wiki

Community-maintained index answering what newcomers repeatedly ask: which brokers and data vendors to use, which books and papers to read, and why most naive strategies fail. Useful as a map of the field before committing to tools.

**Difficulty:** Beginner | **Price:** Free

**Link:** https://www.reddit.com/r/algotrading/wiki/index/

**Tags:** algorithmic-trading, community-resources, brokers, market-data, getting-started

### 3. QuantConnect

Free algo trading platform with tutorials, backtesting, and live trading. Top Reddit rec for practitioners.

**Difficulty:** Beginner | **Price:** Free

**Link:** https://www.quantconnect.com/

**Tags:** algorithmic-trading, backtesting, quantitative-finance, python, live-trading

## Books

### 1. Algorithmic Trading: Winning Strategies and Their Rationale

**Author:** Ernest P. Chan

Chan sets out mean-reversion and momentum strategies across stocks, futures and currencies, with backtest code and discussion of why edges decay. Covers risk management, position sizing via the Kelly criterion, and moving a backtest into live production.

**Difficulty:** Intermediate | **Language:** English | **Price:** Paid

**Link:** https://www.amazon.com/dp/1118460146?tag=edmonddante07-20

**Tags:** books, business-entrepreneurship, trading

### 2. Quantitative Trading

**Author:** Ernest P. Chan

Practical guide to running a small quantitative trading operation alone: finding strategy ideas, backtesting them without fooling yourself, choosing brokers and execution software, and sizing positions. Stresses avoiding data-snooping and survivorship bias in historical tests.

**Difficulty:** Intermediate | **Language:** English | **Price:** Paid

**Link:** https://www.amazon.com/dp/1394378041?tag=edmonddante07-20

**Tags:** books, business-entrepreneurship, trading

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