If you are planning to go down the career path of a Stock Market Broker, Developer, or you’re trying to build a blog where you share your thoughts and strategies about financial analytics, you will need Real-Time and Historical financial and stock market data. This data is most accurately available to you through an API.
“API is the Application Programming Interface that allows third parties to use the functionalities of their websites.” – Redhat
In simple terms, an API is an intermediary that allows applications to communicate with and respond to each other, or it is just a messenger that transfers requests, translates these, and then returns the responses.
Similarly, Stock APIs are intermediaries used to display real-time and historical data about the stocks on your website from another website. Stock APIs are great at providing the real-time and extensive databases which you need for thorough analysis that would otherwise be expensive to buy.
The data fetched from these APIs play a fundamental role in devising Technical Analysis & Indicators, which play a vital role in predicting the next move of your chosen stock/s in the market.
Technical Analysis uses historical data like Price Movement and Volume, to help you expertly manage your trades.
With the continuous advancement in technology, there are numerous free and paid Stock APIs in the market to choose from. However, developers should keep the following attributes in mind whilst considering different APIs:
1: Good Documentation:
First and foremost, good documentation helps a developer identify how to use a Stock API without wasting their time.
Good documentation is perfectly clear, precise, and must be written in a way that puts the needs of a developer first.
We often see that stock APIs have unfavorable documentation because they have poor descriptions of how the API should be used.
The use of examples is a great best practice to look out for. Examples make documentation easy to apply by seeing what was done in the example and altering it for your own purpose. Especially when organized and descriptive comments are used.
It must be consistent with repetitive information and should provide a direct reference or make a reference to a section of common parts.
“Complexity by itself is neither good nor bad: it is a confusion that is bad.” -Don Norman
The next most important attribute to look for, after documentation, is the Simplicity of Stock APIs.
Simplicity allows the user to rapidly utilize an API and to be productive with it without having to constantly check the documentation on each step.
Stock APIs should be adapted to the user’s mind and one step ahead to fulfill the needs of a developer during integration.
Completeness is a pivotal aspect to consider while considering a good API for stocks.
“Completeness is the capacity to answer all of your needs without utilizing excessive trials, complex code, or opening issues to request missing components.”
Completeness also refers to ensuring the expected functionalities are available when needed in the APIs.
So the APIs should address all the aspects a user might need during the integration process, thus making it the best choice among others.
4: High Performance:
Usually, Stock APIs have to deal with a large set of data. So it must be efficient and capable of handling the live and historical data very accurately.
Speed is critical because prices in the stock market change with the blink of an eye, and you cannot risk inaccurate and untimely data as users have often invested an enormous amount of capital into trading. Slight errors in information could lead to huge losses.
5: Intuitive in Nature:
Life is made easier when things are intuitive to use. This principle very much applies to APIs.
A good test for the intuitive nature of an API is whether or not a moderately experienced user can understand the API without the documentation. If you’re a developer, you should be simple to understand the code written in the API itself. If not, then it is likely too complex and could be simplified.
Understanding the coded nature of the Stock API will save you time in the future when you’re using it for your project or business.
6: Well Written Code Pattern:
All code should be written with good code principles in mind. This includes ensuring the code is clean and consistent. This is especially important with Stock APIs because they are written by a developer and then used by many more developers to use in their own tools.
The code should be descriptive, easily understandable, and follows a pattern that is easy to follow.
It’s a great sign if you can quickly identify the coding pattern of an API that the integration process will be smooth.
There are many other non-technical aspects to look for when you’re deciding which Stock APIs to use for your website. These include testimonials and reviews from other users who have used it in the past or currently use it.
It’s difficult to find a single Stock API that perfectly meets all of these attributes so my suggestion is to find the one that will cause the least trouble! It’s also important to ensure whichever option you chose meets your specific requirements.
However, we hope this guide will help you find the best one for you!