Advantages of Automated Trading

There is a long list of advantages to having a computer monitor the markets for trading opportunities and execute the trades, including:

 

Minimizes Emotions

-Trades are executed automatically based on the defined strategy.

- Eliminates over-trading habits. 

- Follow the defined strategy once the trade rules have been met with no hesitation. 

 

Ability to Backtest in Strategy Tester

-Ability to back-test the strategy much easier and faster in strategy tester. 

- Up to 99% accurate back-test result as there is no interpretation and it is based on absolute given rules.

- Ability to back-test historical data with no limit before risking money in live trading.

- Efficiency, speed, and accuracy of the back-test allow traders to evaluate and fine-tune their strategy.

- Generate comprehensive back-test result which Allows traders to evaluate all aspects of their strategy such as winning and losing ratios and drawdowns.

 

Preserves Discipline

- Trades rules are established and trade execution is performed automatically.

 

Achieves Consistency

- Trade once the defined trade criteria are met without missing any trade opportunities.

 

Improved Order Entry Speed

- Improve order entry speed since computers respond immediately to changing market conditions.

- Immediate exit and entry altogether with stop-loss and take-profit orders for each trades once trade criteria are met.

 

Diversifies Trading

- Allows traders to trade on multiple accounts at one time. 

- Allows traders to trade various strategies at one time.

- Allows immediate hedging strategies to minimize losses  

 

Other advantages are:

- Reduce human errors in trading.

- Trades 24/5 all market session unless it is shut down. 

- Reduce levels of commitment by the traders as it trades itself. 

- Gives the freedom to the trader to do other activities and trade at the same time.