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How Stock Trading Robots Help
Those of you that have decided to trade in stocks are particularly favoured where automated software is concerned. The robots available to you are generally more advanced than those available for other types of trading and there are even some highly reliable AI versions on offer.
Efficient And Effective
One of the biggest advantages of robot trading is the sheer efficiency and effectiveness with which they can operate. However, that does not come about without some human input, they are not a ‘plug and play’ type of item. You will still have to take time to plan your trading strategy, program the software to follow your rules and be prepared to change them frequently.
Round The Clock Trading
World time differences mean that on weekdays, trading takes place 24 hours per day and human traders cannot physically maintain constant attention for that length of time. No matter who you are, you need to eat, sleep and no doubt deal with other interruptions. However, your robot does not suffer from any of these confines; it will just carry on regardless as if you were operating your trading platform and never miss a great trading opportunity.
More Trust in The Robot
You need to feel comfortable with your robot, so it is very important to select the automated software which not only suits your trading needs but also allows you a level of control you feel happy with. Expect a period of adjustment during which you can observe, keep records and make changes to your rules. It could take several months before you reach that happy stage of fully trusting the robot.
Higher Success Rates
This is the part that every trader strives for and we are sure you already know that there is a very fine line between success and failure, or a profit versus a loss. Robots do not guarantee a 100% profit, but they do contribute to more profitable trades. This is because they are more logical and able to work at a rate that a mere mortal cannot possibly match.
Different Types of Robot
If you are not familiar with robots, one thing you do need to be aware of is that there is no single solution for all types of trading. Each software program features a unique algorithm developed to fulfil specific tasks, you cannot use the same robot successfully for penny stocks, Forex and stock trading, for example.
Luckily for those of you who are stock traders, the automated software available to you is much more advanced than any available to those who trade in alternative markets. On the other side of the coin, it has much more complexity, so a higher level of market knowledge is essential. The additional complexity also extends to the setup process, where you must add the appropriate technical indicators, rules for entry and exit and financial constraints.
One very positive and interesting thing for stock traders is the current trend towards AI robots, which ‘learn’ as they trade and constantly add new information to their databases. Some developers have even gone as far as giving their robot software a unique named persona with a surprisingly high level of interactivity. Despite the high price tag, the uptake of this type of service has been phenomenal.
Robot Trading Pros and Cons
This is the point where we say we could write a book on the subject and perhaps we could, but even before it was published there would already be bigger, better and faster robots on the market – which bears witness to the speed of modern technological advancement.
As with the majority of great advances, there are pros and cons to automated trading, but here are some of the positive benefits of automated trading systems:
These are very generalised examples and the quality of the automated trading software available to retail traders does vary enormously. You will find some excellent free versions offered as incentives by brokers as well as some that are marketed as ‘top of the range’ but have proven rather mediocre under test conditions.
Conversely, there are a few negative aspects to robots, but not too many. As a human, you could find it difficult to ‘let go of the reins’ and relinquish control of your trading to automated software. You must develop a sufficiently robust trading strategy which works before you let a robot loose with it. There are also unfortunate physical aspects that can affect your robot’s performance including power loss, a poor Internet connection or a device crashing.
One very positive and interesting thing for stock traders is the current trend towards AI robots.
How to Find Legit Software
Unfortunately, it is all too easy to fall into the trap of paying for useless software, or worse still, downloading a program or app which contains malware of some sort. Having been in this business for a long time, we have encountered almost every trick in the scammer’s book, but there is always a new one just around the corner. Sometimes it may seem easier just to do everything yourself, but that comes at a high cost in terms of your valuable time.
One way to avoid such issues is to find a software service which is backed by either a well-known and trustworthy company or possibly a broker service. In itself, that is a time-consuming and potentially daunting task, but take heart, this is where we can help you. We have a team of expert reviewers who are a step ahead and have already done a lot of the leg work on your behalf.
Our reviewers concentrate on two different aspects where robots are concerned. Primarily, on finding reliable brokers that offer automated stock trading opportunities to clients. We also review reputable companies that develop the algorithmic software itself, who tend to work with a limited list of brokers. Either way, you can rest assured that any broker or software which has made onto our recommended list has been thoroughly vetted and has proven trustworthy and reliable.
Our Review Rating System (More Info)
- Account Types
- Banking & Payouts
- Bonuses & Promotions
- Mobile Trading
- Trade Types
- Special Features
- Customer Support
Is automated software trustworthy and reliable?
Unfortunately. human nature dictates that there are ‘scams’, as well as plenty of useless software on the market. We always recommend that you only download this software from trusted sources.
Can they predict the right decisions to make?
The algorithm used by robot software bases the likelihood of a successful trade on past market analysis, not on predictions of what the market will do, so it is not infallible.
Will I need to pay money for decent software?
There are some very good free versions and also some very expensive mediocre ones. Selecting the right software is often achieved by finding the one that suits your needs, rather than by setting a budget.
What if my trading software gets it wrong?
Your robot will be programmed to follow the rules you give it. If you see a greater average pattern of losses, then you will need to rethink your trading strategy and make appropriate changes.
How do I find the best services to use?
We have two suggestions. Either select a broker which allows robots and run a trial using a demo account, or you could download a platform from a developer’s website where there is usually a bigger selection of automated software to try.
Marilyn won’t mind us saying she’s our resident geek. She spends most of her time recommending various investments to her clients based on their financial goals and how risky an investment strategy they are interested in undertaking.