TheRole Of Robots In Trading
The popularity of automated trading robots has seen an increase in the past few years. In fact, they seem to be getting more popular in spite of no real assured guarantees or returns when using them.
Robots have helped make life much simpler and there are many fields where one cannot imagine life without them. Though trading is a relatively new field where robots have made their presence felt, it definitely seems like they are going to be around for a long time.
What are FOREX robots?
FOREX robots are automated systems that are used in place of humans to enter trade orders. The biggest role to play in the skill or success of a trading robot is that of its creator.
The returns of the trades are generated depending on the mathematical rules, which the creators decide. It follows a pre-programmed routine. It does not adapt, change or revise according to the changing market conditions. Depending on the technical analysis, the robots are programmed to execute the commands.
Things to keep in mind:
It is not uncommon to find companies such as HBSwiss claiming that their system would give you the best trading results. To know more, read the complete HB Swiss review here. While certain claims might not be entirely false, there are some important points to keep in mind before using these robots.
- Most of the robots have not been tested in real market conditions. Hence they might not be fully equipped with issues not related to trading. Some examples of such issues are problems at the broker end or any connectivity issues.
Though the robots are tested using historical data, it does not give them an adequate amount of preparation to survive the trying market conditions.
- The biggest disadvantage would be its lack of flexibility to adapt to the current market scenario. It will run according to the program rules irrespective of other factors. This is not desirable in a fluctuating market.
- How effective a trading robot is would depend on the intelligence of its creator. One would never know how intelligent or effective the trading methods of the creator are. This would be a huge risk since they would be dealing with your precious money.
For those who trade actively, it is natural to have the curiosity and temptation to use the services of a trading robot. With the number of choices available and with each solution advertised as the best software, the decision becomes more difficult.
Whether one chooses to use robots or not would be a matter of personal preference and fulfilling the specific trading objectives. It is imperative to understand and have all the necessary information before using any trading robot.