Back
Who trades better: a trading robot or a human?
Find out who is more effective at trading and why. Is it worth a person to trade or is it better to delegate it to automated trading systems.
Jul 21, 2021
4 min read
Peter JanssenMarket expert

The XX and XXI centuries greatly accelerated and automated everything in our life: we switched from horse-drawn carriages to cars, created a conveyor belt and established mass production, flew into space - during this time a lot has changed. Human nature has a desire to improve technology, to do everything faster, better and easier.

Fundamental changes have also affected the world of finance, including trading in financial markets. Any seasoned trader who makes more than he loses has a trading system honed to perfection. But only the presence of this system will not necessarily bring you profit, any trader can misinterpret something, ignore, forget or simply make a mistake, he is not only a robot! It is enough just to be in a bad mood due to bad weather, so that instead of profit, you start making mistakes and getting losses.

Trading robots

The age of automation gave us trading robots - this is software that works according to the algorithm of any trading strategy, which automatically performs transactions in the financial markets.

Now, according to statistics, fewer and fewer people are engaged in manual trading, because traders are well aware of the importance of automating this process. The market does not forgive mistakes and every wrong step will cost the trader money, so it is critical to eliminate all possible mistakes in order to minimize your losses and increase your profits.

Components of trading

Will not talk about trading systems, let's talk about the other side of this issue.

Accuracy - the advisor's algorithm can perform only those actions that are written in it programmatically, it cannot be wrong. As soon as the market situation satisfies the conditions of the trading algorithm, the robot immediately performs the necessary actions, opening a deal, for example. A person is not a machine and cannot always be concentrated, have a sharp reaction, be accurate and fast. While a person is blinking, within 0.1 seconds the automated algorithm will have time to make a trade decision and perform the necessary actions. It will take a person much longer to at least process the information.

Efficiency - the robot already knows what to do, the decision-making algorithm is already written and processed in a split second. A trader needs to manually track many factors in the market, keep in mind a lot of information and at least try not to forget it. A person is unpredictable by nature and extremely prone to emotions, which is guaranteed to lead to losses. The human factor is always present and this significantly reduces the efficiency in trading.

Fatigue is about people, but not about trading robots. The robot will work exactly as long as you need, a minute, a day or a year, it doesn't matter. A person gets tired very quickly, especially when you need to constantly look at charts and read the news. The maximum efficiency in manual trading is observed only in the first 60 minutes after the start of the trading session. Then the inevitable losses gradually begin to fail. In NYSE or CME trading pits, traders can hold out longer, but they always need a break. But not for trading robots.

Emotions are what makes a person a person and brings the greatest losses in trading. When you trade, greed and fear awaken in you, and when things go really bad, hope appears and completely kills your account. This happens all the time with beginners and a little less often with experienced traders. Emotions have no place in trading on financial markets, and the robot does not have them.

Robots are winning

You don't need to keep comparing - automated trading algorithms win in every way. To compete with them, you need to be a real "robot", not a human.

The most important thing for you is to choose the trading robot that suits you.

 

 

Last article
Read other articles
Anna Bakker News analyzer
News of Strong US Retail Sales Significantly Amplified USD Growth
Sep 17, 2021
2 min read
Anna Bakker News analyzer
Bitcoin price has already risen to more than $ 44,000 and has recovered from the fall in prices caused by the ban of cryptocurrencies in China
Sep 27, 2021
1 min read
Anna Bakker News analyzer
A clear increase in bullish sentiment is observed according to the COT (Commitments of Traders) report for Bitcoin
Aug 16, 2021
1 min read
Forex Expert Advisors for your Profits
Forex trading robots based on AI. Innovative trading technologies for a stable growth of your profits