Advantages of The Automated Trading Systems

Automated Trading SystemsA high percent of the transactions made by the participants of the foreign exchange market are short and close during the day. In this way, a typical speculator on this market makes thousands of transactions during his life. Most of the investors begin to trade with currency after a friend recommendation or after a short-term trading on a demo account. At first, most of the transactions are influenced by analyses, drawn from various brokers, posts on the Internet forums, trading on various widely discussed indicators, etc.

Such single transactions, at best have zero mathematical expectation in a long term, and as we consider the spread (the difference between buy and sell offers) of the broker, the participation in the currency market becomes statistically losing business.

The basic problem comes from the fact that the signals are based on different market situations and the success of a particular transaction is not a precondition for a future one. We may have expectations for future profits by a transaction, only if they lie on the basis of some elements of the market situation that had been profitable in the past. And here come the expert advisors.

On the one hand, they allow us to test the results in set of rules given in the past. The repetition of the same set of rules in the future will give us confidence that the statistically, we may expect another profitable deal. On the other hand, an advantage of the automated trading systems is that they can trade 24 hours a day, 7 days a week, on much more instruments than a person could be able to watch at the same time. The response time and the high speed for more complex calculations are also in favor of the expert advisors.

To a large extend, the human factor is eliminated and emotions will not be a bad advisor any more. Everyone who trades on the currency market knows that the lack of discipline and predefined rules to follow are the main problem that could trip you over. The human factor is minimized, or reduced to the level of setting the parameters for entry and exit.

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