Automated trading

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    Automated trading is where trading decisions are conducted by a computer program or script. The conditions for each aspect of the trade such as the entry, profit taking, setting stop losses, etc, are programmed and then, when those conditions are met, the automated program will trade based on the criteria set out by the programmer.

    The advantage is that the trading robot will only trade based on the rules set out and will not deviate from them. This takes away some of the psychological strain when trading. The robot can also trade for 24 hours.

    The disadvantage is that because there is no human judgement, the program will not take into account any changes that occur in the market.

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