Automatic trading: advantages and disadvantages :


Automatic trading is a tool to automate the process of opening and closing positions in financial markets like forex. It is therefore no longer the trader who performs this operation but a program previously programmed for this purpose. This system has advantages and disadvantages that we detail below.

Advantages

Automatic trading has many advantages:
- With automatic trading, finished the positions taken under the blow of the emotion. Since it is a robot that executes programmed orders, your trading has less chance of falling into irrationality.
- Unlike human beings, trading robots are not subject to fatigue or sagging. They can also work day and night and all year round.
- Computer programs are able to think quickly and well and above all, they can manage millions of operation in the same second while controlling many parameters. In other words, their capacities surpass those of humans.
- Automatic trading is done on its own. Once the robot is programmed, it will run the strategy in complete autonomy, which means that the trader can engage in other activities.

Disadvantages:

Automatic trading has many advantages but also some disadvantages:
- As efficient as the trading robots used, their intelligence remains artificial. To the extent that they do not reflect on their own, they will be unable to adapt to a changing market situation.
- Developing an automatic trading program is difficult. During its creation the issues you will address will not have too much relationship with the trading itself but rather with research and development.
- An automatic trading program is based on logic, so a logical strategy must be developed otherwise the program will not know what to do.
- Developing an automated trading program requires knowledge and skills in computer programming. If this is not your case, then you will have to turn to professionals who offer this service.
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