Trading robots are programs that are actually trading instead of people. There are many types of such programs; for example, the so-called Advisors that provide useful advice on when to buy or sell certain securities. Program advisors analyze large volumes of information within short periods of time. The recommendations are sent in the form of messages or sound signals.
Another type of trading robots are the robots monitoring possible losses, risks, and manage securities by various trading strategies.
Using trading robots provides traders with the opportunity to save time and monitor a large number of assets. In addition, unlike people, whose emotions often have great impact on the trading process, such programs are completely devoid of any emotion.
However, automated systems have a number of disadvantages. The program cannot predict the impact of statements made by presidents or other officials on the country’s economy. Robots act in response to events: as soon as the asset begins to fall, the robots start selling. However, they cannot foresee crises and get rid of excess assets in advance.
One shall test and optimize the trading robots from time to time, so that they would bring steady profit. Please keep in mind that even if a robot brought, for example, 200% per year, this does not guarantee the same income next year. Next year, its yield can vary from 10% to 20% or even turn out negative. Therefore, one should choose the right historical data upon which the robot will be tested, and only then choose the right algorithm.
Now traders and managers do not fully rely on robots and mostly use them for risk management, making reports, and trading recommendations. Based on this data, a trader makes an independent decision whether he shall follow the program recommendations or not.
Using robots for trading binary options seems useless, as this tool is the easiest way of trading in the financial markets. The transactions are submitted by a single click, so the robot has no advantage of quick execution of transactions for buying and selling the assets, considering all the rules set by the exchange. In this regard, the binary options robots are used rather rarely: this is the only place, which didn’t become a battlefield for robots, so professional traders can get steady income there.
NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future.
In accordance with European Securities and Markets Authority’s (ESMA) requirements, binary and digital options trading is only available to clients categorized as professional clients.
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