BannRonn's Stock Trading & Investment

PC Hardware for Real-Time Charting and Trading System

Powerful laptop for stock tradingThe computer hardware system requirements for real-time trading charting software and data vary according to the amount of real-time analysis of financial data that is required to be done on your PC locally. Real-time trading computer systems can range from basic off-the-shelf Intel Core 2 Duos, Pentium Dual Core or AMD Phenom or Athlon systems to custom made Core 2 Quad Extreme or Xeon servers with 16GB RAM or more. Reliability and quality of the computer system and internet connection are key to achieving a trouble-free trading computer system which will free you to concentrate on making money trading. Check out Best Computer for Stock Trading for a review on the Dell Precision T3400 series of business workstations.

Essentially, there are 3 types of real-time trading charting software and data vendors as follows:

Live Streaming Charts and Data

Live streaming data are actually live financial quotes displayed on your PC in real-time but no data is physically stored on your PC. All data, be it live or historical, is downloaded as needed from your data vendor's servers. This is normally the most basic level of real-time data and most brokers will provide this free with your trading account. The features vary widely as some may provide some basic charting capabilities whereas others just provide basic level 1 (bid, ask, volume & last done) quotes. You can also subscribe to live streaming data at very reasonable rates (typically < $10 per month) from reputable service providers like Yahoo Finance. You can also try a free streaming package from ADVFN. Many data vendors also provide basic stock screeners with the streaming data which allow you to identify securities based on pre-determined criteria. An excellent and inexpensive front-end charting solution that can utilize various free broker data-feeds and a trader favorite is Medved QuoteTracker.

The computer system requirements to run live streaming data are very basic. An entry level Pentium Dual Core system with at least 512MB - 1GB of computer memory (RAM) will suffice. The amount of RAM required will increase depending on how many securities are monitored in real-time.

Real-Time Trading Charting Software and Data

The next level of live data is best approached from the quality and timeliness of data angle. There are a fair bit of software and data vendors in this sector but it must be noted that many of them are 3rd party data resellers so you can see where the timeliness factor comes into play. The big boys like your money managers and financial corporations will normally get their data from 1st tier providers like Thomson Reuters and Bloomberg. These systems are very costly but they do provide the best data available anywhere. For professional and proprietary traders trading full time, many of them trade with the above-mentioned systems but others may choose the next level of software and data providers such as RealTick and CQG. The general public and the majority of startup traders normally choose data vendors that are priced more reasonably but still offer robust software and data like eSignal and QCharts.

The critical PC components required to run a real-time data system smoothly would be at least a Pentium 4 or Athlon XP class CPU with 512MB or more of computer Random Access Memory (RAM). Read this Computer Memory FAQ to determine how much RAM is required for a trading computer system. The speed and quality of your internet connection are some other important factors as it will determine the timeliness of your data. If there are major bottlenecks in how the data gets from the source to your computer, you will have lagging data which may end up costing you money especially if you are scalping the markets.

Real-Time "On-The-Fly" Trading Analytics

As desktop computing power increases, the retail player based at home is able to tap to software systems which were previously only affordable by large money managers or trading prop shops. Real-Time analysis software like NeoTicker and NinjaTrader enable anyone with real time data to analyze thousands of stocks or trading instruments in real time to search for pre-detemined conditions and parameters.

For e.g. lets say you typically trade using a 5 mins chart, which is a popular timeframe for e-mini S&P 500 futures traders, and you want to buy a component stock of the S&P500 when the S&P futures form a head & shoulders and break out to the upside but with the condition that the component stock is still below its 5 period moving average. To do this manually in real time is definitely impossible but with the right software and trading system, once programmed, the software will "on-the-fly" analyze all the market data coming in and alert you when any stock matches the criteria you specified. You can then review it manually and place a trade or you can even completely automate the whole process such that the computer will look out for the pre-determined conditions and put on a trade automatically. This would however require integration with your broker's order entry system which is currently being supported by more and more analytics software vendors.

For these real time analytics systems, the raw CPU power is very critical and nothing less than a Pentium Dual Core CPU system or at the very least a Core 2 Duo or Athlon Dual Core system should be considered. The amount of RAM or computer memory is also very critical and the recommended here is to max out the RAM for your system. If budget is a constraint, go with at least 2GB RAM minimum (see Computer Memory FAQ for more details). Your internet connection is also critical and you will definitely need a broadband connection preferably with another Cable or DSL as backup. Big Scalpers and High frequency Traders normally lease dedicated servers close to the exchange they are trading so that data latency is overcome when they trade, some times within millseconds.

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