Once you have decided that you want to venture into algorithmic trading, most important decision you have to make is which broker to choose. The obvious criteria is API support, but that is not the only criteria so in this article we will delve into some of the other factors you should consider while choosing right broker.
This is the most important criteria. The broker should support API based access to your account. Several factors you need to consider are-
Usually there is a charge associated for enabling the API access and it comes as a monthly fees. You may have to pay for the data separately.
Comparative summary of brokers providing API support against fees and official SDK support.
| Broker | API Fees | Data Fees | Official SDKs |
|---|---|---|---|
| Zerodha | 2000 Monthly | 2000 Monthly(Optional) | Python, NodeJS, C#, Java, Golang, Rust |
| Fyers | Free | No Data feed | Python, Nodejs |
| 5 paisa | Free | Live data only | Python, Nodejs, Golang |
| Interactive Brokers | Free | - | Python, Java, C++, C# |
| AliceBlue | Free | Live data only | REST API available But no official SDK |
| Upstox | 750 Monthly (service is only available to closed-group) | 500 Monthly(Optional) | Javascript, Python |
| IIFL | API supported but no documentation | ||
| Nirmal Bank | API supported but no documentation |
Even though Zerodha had started the concept of API access, Fyers, 5 paisa, AliceBlue and Interactive Brokers are making this space competitive. I had personally used Upstox in the beginning, but they have stopped providing API access to everyone and restricted it to a very small group of people.
Usually algorithmic trading will involve higher number of transactions than usual, so you should prefer a discount broker. Please understand brokerage charges for different products - intraday, futures, options etc.
You should also consider other charges like AMC, pledging charges, Payment gateway charges etc as well because it will add to your overall cost and affect profitability.
There are already multiple sites doing this comparison so I’ll skip this bit
These the factors which cannot be quantified, but you do need to consider them. Please check different online forums and read reviews.
Main concern for any algo trader is that platform should always be available, downtime in the service can be fatal. So please look out for posts, comments etc in social media regarding downtime and service.
Eventhough there are number of brokers providing free APIs, API reliability is a huge factor here, but there’s no direct indicator for reliability. Do read reviews on https://tradingqna.com/ or traderji.com on actual user feedback before making a choice.
From my personal experience, I’ve used Zerodha and did not face any challenge. I’ve used Upstox as well but they have stopped API support for general public. Currently I use jugaad-trader library to execute my orders with Zerodha and Upstox.