Automated Trading, Agents, and BOTS

An expert advisor may be manually traded -- the trader waits for the signal and then executes the order manually, or, more commonly, automatically traded -- the expert advisor executes the trade as it occurs. Computers do not get tired or hungry. They can make money for you 24 hours a day -- if the program is good. At the top end, automated trading has eaten away at the old-style, discretionary seat-of-the-pants trader. This is in trickle-down to the retail level today; more and more small traders are embracing automated trading strategies.
Because of this new popularity of automated trading, many brokers now offer tools and accommodations for automated trader programs.

It may well be because I am older now but I simply do not fully trust most of these programs, especially the ones that trade very short term. At the institutional level, I believe a reckoning is on the horizon. In my humble opinion, an experienced trader can add synergy to any automated trading system. I wince when I see an advertisement for a trader who has a PhD in physics or computer science and the comment, "No trading experience required."
By Michael Duane Archer
Michael Duane Archer has been an active futures and FOREX trader for more than 35 years. He has worked in various advisory capacities, notably as a commodity trading advisor, registered SEC investment advisor, and branch manager for Heinold of Hawaii. He currently trades FOREX and futures and is involved in several technical analysis research projects.

Copyrighted 2020. Content published with author's permission.

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