Advantages of Algorithmic Trading That Justifies its Huge Popularity

09 May

If you are like many people, you have probably thought of going the algorithmic trading route. As a matter of fact, over 75% of traders today use algorithmic trading over the manual form of trading. This is attributed to the huge popularity that it has gained in the recent past. The following are the major advantages that justify this forex signals live huge popularity.

The first notable advantage of algo trading is speed. As is with any other automated process, you expect the speed at which the trades are made is much faster compared to manual forms of trading. This is attributed to the fact that the trading algorithms are often written previously and the executions are made automatically.

Multiple indicators are used to scan and execute very fast. What this means is that because the trades are analyzed and executed much faster, to the trader it means you will have more opportunities at much better and unrivaled prices.

Also notable is the fact that there is very little margin of error when it comes to algorithmic trading. Human trades are often marred with errors, say for instance when a trade is being keyed in, or when pairing currencies and the process has to be done manually. Because the trades are executed automatically, you are guaranteed of 99.99% accuracy.

Reduced trading costs
Arguably one of the biggest advantages of algo trading that has attracted a very large percentage of traders is the reduced cost associated with the trading process. As previously mentioned, algo trading is executed automatically, meaning you do not have to spend hours on end monitoring and studying the markets. The continuous supervision associated with manual trading takes a lot of time, money and effort so automation provides a great saving on opportunity cost associated with constant monitoring of the trading markets.

No Human Emotions
Manual trading is often associated with lots of emotions that results to irrational decisions. More often than not, traders are prone to greed and prone, which is not the case with algo trading since the trades are limited within a set of preset criteria. Know more about forex robot free.

A lot can be said on the advantages of algorithmic trading, but if the current statistics are anything to go by, no doubt it is the best thing that ever happened to traders at this time and age. The internet provides enough information to help you make an informed decision on algo trading and the best approach that will give you the highest possible returns.

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