Forex Auto Trading Systems (Pros and Cons)
What is an Auto-Trading System?
An automated (or mechanical) trading system is a combination of hardware and software that uses a specific set of rules to execute trades 24/5. Once programmed, an auto-trading system can automatically open and close positions via the use of a computer, a trading platform, and an internet connection. The entry/exit rules can be the subject of multiple conditions including price, volume, time, volatility, etc.
The proper use of a Forex auto-trading system requires state-of-the-art technology and a reliable Forex Broker.
Here are some key pros and cons when using a Forex auto-trading system:
(√) Auto-Trading Pros
(1) Automation (Saving Time)
As an auto-trading system trades 100% autonomously, traders can save precious time and focus on other fields of their life.
(2) Trading 24/5
An auto-trading system can trade without sleep or rest on a 24/5 basis.
(3) Speed of Execution
An auto-trading system can analyze the market considerably faster than any human trader but also to execute trades at a glance. This can be a great advantage in times of extreme volatility (i.e. times of news releases).
(4) Objectivity of Decision Making
Human traders usually suffer from stress and follow an emotional decision-making procedure. Auto-trade systems follow their programming rules in a 100% objective and repeatable manner.
(5) No Fear or Greed
Fear and greed are some of the worst enemies of every trader. Fear prevents the trader from accepting necessary risks. Greed prevents traders from closing out a bad trade or can motivate traders to maintain their positions longer than they should.
(6) Implementing Complex Strategies
An auto-trading system can implement complex and advanced strategies such as High Frequency Trading (HFT) strategies.
(x) Auto-Trading Cons
A decent auto-trading-system requires the use of state-of-the-art computer technology and a Forex Virtual Private Server (VPS). They both cost.
(2) System failures
System failures may occur. Moreover, a locally running auto-trading system may lose its internet connectivity and crush. Some auto-trading systems cannot recover effectively from a system breakdown.
(3) Difficult to Control Losses
If market conditions become unfavorable, an auto-trading system can suffer a substantial number of losing trades.
An auto-trading system offers a great number of advantages over manual trading. The key advantage is the lack of fear and other emotional limitations but also the lack of physical limitation (sleep). On the other hand, auto-trading systems cost serious money and require a sophisticated software programming in order to operate properly. The implementation of an effective money management system is also extremely important for every auto-trading system.
■ Forex Auto Trading Systems (Pros and Cons)
ForexExperts.net Blog (2018)
5 Trading Tips for Beginners
Starting out in trading forex can be very daunting and overwhelming. It is easy to lose your way and get weighed under all the information that you come across. The best thing you can do for your trading and your sanity, take it slowly.
Here I have put together 10 basic points (that I wish someone had told me before I started trading!)
When starting out, chose a broker which offers its clients an excellent educational programme, such as Vantage FX. Vantage FX is an Australian based, award-winning forex broker, which provides clients with a comprehensive educational programme including articles, videos, and free webinars.
■ ForexExperts Blog
Trading with Option500
Option500 is a binary options broker based on the Tradesmarter technology. The broker is basically situated in the Domenica Repuplic and London, UK. Option500 offers a wide asset index containing Forex, Commodities, Shares, and Equities.
Option500 offers a single account type which can be funded with $250. The fund methods include cards and bank wire.
-Bank wire and credit/debit cards ( Visa, MasterCard, and Maestro)
-$250 minimum account
-A free practice account is available
The Option500 platform is easy-to-use and provides the classic High/Low Options, Option Pairs, and the innovative StrategiX trading mode.
The platform incorporates a built-in Social trading app, which can be used for sharing and joining positions and strategies.
Option500 traders can change their view on any chart using the “View Selector”. In addition, important information is listed along with any financial asset, including volatility and the market sentiment. Finally, traders can also adjust their basic dashboard to keep their favorite financial assets always on their trading screen.
With Option500 Mobile App, you can follow trends in real time.
Risk-o-Meter and Other Features
These are some key features:
The payout rate of any position can be adjusted using the “Risk O Meter”. This tool helps traders to set their individual risk acceptance.
Diversified option types
Double up feature
Sell back feature
Charts showing volatility and the market sentiment