The evolution of brokerage trading technology is nothing short of astounding. Trading has ceased to be a prerogative of institutional traders only. Today, anyone with a computer and internet access can access global financial markets and trade from virtually anywhere in the world. This revolutionary change is mainly due to the development of online trading platforms from software giants like MetaTrader and Interactive Brokers' Trader WorkStation (TWS). Both platforms come with powerful Application Programming Interfaces (APIs) that open the door for developers to build custom trading applications. This article explores the ins and outs of trading platform development using MetaTrader or TWS API.
MetaTrader API
MetaTrader from Metaquotes Software Corp. is arguably the most popular among retail traders. It offers two premier trading platforms, namely, MetaTrader 4 (MT4) and MetaTrader 5 (MT5). Both editions support automated trading through Expert Advisors and carry API infrastructure that allows developers to build and integrate custom software.
MetaTrader APIs provide direct access to the components of the MetaTrader platform. They allow the creation of applications that interact with the platform and execute operations on behalf of the user. Moreover, they enable communication with the platform without going through the graphical interface. This provides flexibility for developers to build software applications ranging from simple novelty indicators to high-frequency algorithmic trading systems. Note, the current version, MT5, supports a broader scope of operations compared to MT4, including, but not limited to, trading, streaming of price quotes, account management, and testing of trading strategies.
There are two main types of APIs in MetaTrader: the Manager API and the Server API. The Manager API facilitates the creation of system utilities to handle account and order management, while the Server API enables developers to build their own custom servers.
Interactive Brokers' TWS API
Interactive Brokers (IB) TWS is mainly used by professional traders and investors. It, too, has an API, referred to as TWS API, that allows third-party developers to build applications that interact with the platform. The TWS API is an interface to IB’s standalone trading applications, TWS and IB Gateway.
The TWS API enables developers to build trading applications that can: automate trading, retrieve streaming and historical market data, access account data, implement trading algorithms, execute trades, and manage open orders and portfolios.
The key feature that sets TWS API apart is its support for multiple programming languages, including but not limited to Java, Python, C++, and .NET (C#). With TWS API, you can perform tasks such as managing real-time data feed, submitting complex multi-leg order types, managing account balances, and receiving live trading notifications.
Choosing between MetaTrader and TWS API
Choosing between the two largely depends on your specific needs. MetaTrader tends to be more popular among retail traders, particularly in the FOREX market due to its user-friendly interface and comprehensive charting capabilities. On the other hand, TWS suits institutional and professional traders better due to its sophisticated trading tools and wide range of tradable securities.
In conclusion, both MetaTrader and TWS bring the financial markets to your fingertips. They both offer powerful APIs that can go a long way in custom trading application development. It is worth noting that trading platform development is a sophisticated technical project that requires a deep understanding of both trading and programming. Therefore, it would be wise to consult with a professional tech enterprise to bring your trading vision to life.
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