Automated trading is the use of special systems or software to automate your investments. An automated trading system will use algorithms to monitor the market and open and close trades based on several factors.
According to market experts, the automatic trading could be the future of investments. Simply because it takes the emotions out of trading, lessens the need to follow the market and your investments, and can give you a great trading portfolio effortlessly.
Who is automatic forex trading suitable for?
Beginners : Automated trading is suitable for beginners who know the basics of forex trading but lack the expertise to effectively apply their knowledge and detect relevant trading opportunities. In fact, if you follow trades on an auto trading system carefully, you can learn a lot. Many auto trading service providers also offer expert support, advice and learning tools.
Traders who want to diversify their trades : if you want to invest in several currency pairs at the same time, or if you want to try crypto-currencies, automated trading can make it easier for you. The forex market is very volatile, so investing in multiple currencies at once can seem like a huge risk to investors. But, since auto trading handles are hard work for you, you can dive into several trades at once without having to follow them.
Experienced traders who lack time : Do you have the knowledge and expertise to invest profitably in the forex market, but simply lack the time to continuously monitor investments? Because if so, automated trading systems make trading much easier and more efficient. All you need to do is enter a few details to custom design an algorithm that will suit your investment stylethen let the software do its job.
Advantages of automated trading
It’s a time saving : Constantly following current news, spotting the right time to open or close a trade, or even keeping track of your investments can be extremely time-consuming. Automated trading makes this much easier and significantly reduces the effort needed to invest in the forex market by taking control of your investments.
It’s simple : If you are new to the forex market and want to start your investing journey, following the signals and automating your trades accordingly can be a great way to do so. So, thanks to automated trading, you don’t need to be an expert to trade successfully.
It’s effective : Diversifying your trades would mean having to follow multiple trades and keep up to date with each of your investments. However, automating your trades gives you the ability and time to invest in multiple markets without having to worry about repercussions.
It’s objective : It is common for investors to be overwhelmed by current market news and trends and, as a result, make emotional rather than rational decisions. Fortunately, with the help of an automated system, you can take the emotions out of your investments and invest with a more calculated approach.
Disadvantages of automated trading
You don’t make the decisions: Although sitting back and watching the show unfold on its own seems like a dream come true, for many investors it would feel like they could no longer control their investments.
It’s too reliable: The constant management of your transactions makes you dependent on computerized systems. You start to lack the skills and expertise to manage your investments on your own – and sometimes even the will to do so.