A Beginner's Guide to Automated Trading

A Beginner’s Guide to Automated Trading

Did you know that the companied value of all of the companies on the New York Stock Exchange is around $15 trillion? Clearly, there is a lot of money to be made in the stock market. But that doesn’t mean it’s easy to profit.

Thankfully, you can use automated trading, also known as algorithmic trading, to increase your chances of beating the market and making some major gains.

But what is automated trading and how can it work for you? Keep on reading and we will walk you through everything that you’re going to want to know!

Automated Trading

What Is Automated Trading?

Algorithmic trading is a trading strategy that uses automated trading software to scan markets all over the world in order to find trading opportunities. When the software finds a trade that fits the algorithm, it automatically makes that trade.

Without lifting a finger, you can be making a lot of money. Of course, nothing in the market is guaranteed. If there’s something imperfect with the algorithm then you could also end up losing a lot of money.

How Does Automated Trading Work?

When you talk about automated trading, you are talking about using an algorithm to trade. An algorithm is a mathematical formula in which you add inputs in order to achieve a certain result.

For example, when you search for something on Google, Google uses a complex algorithm to deliver you the most relevant search results.

For automated trading, your algorithm analyzes financial metrics instead of search results. The software will look at market sentiment, liquidity, volatility levels, and trading volumes.

The algorithm doesn’t do anything that a smart person with a good calculator couldn’t do. However, what’s great about automated trading is that the software can do all of this in a very short amount of time with thousands of inputs.

Analyzing stocks on your own can take a lot of time and is also very stressful. The algorithm doesn’t make emotional decisions and it can save you time to be more productive elsewhere.

How to Find an Automated Trading Provider

When it comes to automated trading, no one is expecting you to come up with the algorithm on your own. There are bots and services that you can pay for in order to use their software.

If you don’t buy a high-quality bot then you could end up making a lot of very bad trades and quickly losing a lot of money

This is why you want to choose a platform that has a good reputation, a proven track record, and offers a free trial so you can try it out before you make a purchase. KJ Trading Systems is a great example of a popular and respected platform.

You can find bots for the stock market as well as automated forex trading and automated crypto trading.

Start Making Money Today

While the stock market can be intimidating, it doesn’t need to be something that you avoid. Now, with automated trading, you can match or beat the market and let your computer do all of the work for you. Don’t forget to check out the rest of our site today for more helpful articles!

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