Week 11: Learn Broker APIs and Operational Safety
An API enables software to communicate with a broker's trading system. A typical pipeline: live market data → strategy rules → position & risk checks → broker order API → order-status confirmation → trade log and alert.
Study
- API authentication and access tokens
- Instrument identifiers
- Order placement, modification and status updates
- WebSocket market data and rate limits
- Error responses, rejected and partially filled orders
- Position reconciliation
For coders, Zerodha Kite Connect and the Upstox Developer API provide programmatic order and market-data facilities. Verify the latest pricing, eligibility and order restrictions directly with the broker.
Essential safety controls every live algo needs
- Maximum loss per trade and maximum daily loss
- Maximum orders per minute, open positions and exposure per stock/sector
- Duplicate-order protection and stale-data detection
- Funds/margin checks and confirmation of every order's status
- Automatic exit before the required cut-off
- An emergency kill switch, failure notifications and complete activity logs
A stop-loss existing inside the program is not enough — the system must confirm the exit order was actually accepted.
Indian regulatory framework
Retail algo trading in India operates within the framework prescribed by SEBI and the stock exchanges (SEBI's retail algo framework was introduced in February 2025). It covers broker responsibility for API access, algo-order identification and audit trails, registration of applicable algorithms, empanelment of algo providers, authentication controls and order-rate thresholds. Review the NSE list of empanelled algo providers before selecting a third-party service, and never share your broker password, OTP, PIN or unrestricted API credentials.
Week 11 outcome
You should understand how signals become orders and how to protect the account when data, connectivity or execution fails.
This lesson is for educational purposes only. It is not investment advice, a recommendation or an assurance of returns. Trading and derivatives involve substantial risk, and backtested or paper-trading results do not guarantee future performance.
