What is Algo Trading and Why you should prefer it over manual trading

What is "algo trading"?

With the advent of time everything seems to be getting automated and trading among all the other things is no exception to the trend or rule. 

Somewhere we all are tired and sick of manual trading and relying on emotions and instincts for taking the right decision. 

Even though you may have good instincts or you may take your decisions calculatedly keeping the emotions aside (that’s what we think) but somewhere while trading, you rely on human instincts and are bound to use your emotions more than the use your brain or calculations. 

But this is not possible with a machine. So humans invented Algo Trading to get rid of human biases and greed, make trading more hassle-free and profitable. Software or algorithms don't have instincts or emotions, (at least for now) they are bound to be found in humans and so they can be more reliable. 

Algo trading or Algorithmic trading or also called Automated trading or Black-box trading makes use of technology i.e. computers and software programs to do the trading stuff following a precise set of instructions or algorithms. 

These algorithms or sets of instructions are based on all the parameters that a normal human uses while trading or so we can assume i.e. timing, price, quantity, etc., or any mathematical model in case of a machine. And thereby you eliminate chances of emotions or greed or instincts making wrong decisions for you. 

Bonus point you don't need to sit in front of your TV or computer or laptop or tablet or mobile 24/7 to keep a check on the live data every minute, you just set an instruction for yourself, sit back a little and chill with your chai or coffee or cold drink(whatever you prefer).

In simple words, Algo Trading makes use of algorithms seeded to it by humans based on some pre-decided factors like price, quantity, market conditions, real-time data, etc. to place a trade on your behalf. 

It makes use of complex mathematical structures to execute the instruction provided or place trade themselves. It can be performed or used in two ways based on its functioning and service it provides: Semi-automated and Fully automated software.

• Semi-Automated Software, as its name suggests is semi-automated i.e. the software uses the algorithm to make a signal for buying or selling and the trader has to confirm the signal manually, then it is placed.

• While, in Fully Automated Software, the buying and selling is done automatically after giving the signal of it. No manual supervision is compulsory for it to place trades.

Benefits of Algo Trading:

Algo Trading has many benefits for various stakeholders. Some of these are:

1. You get to trade at the best possible price

2. Your Trade is placed at an instant time, avoiding the effects of slight price changes

3. The Trade orders are placed accurately as instructed

4. Less probability of human errors

5. Least Opportunity for any psychological or emotional decision making

6. Automatic inspection of changing market scenarios

7. Reduction in costs spend on human resources

8. Easy to carry out a large amount of trade in limited time period

We are not going to shy away from admitting that algo trading has its own limitations of sorts like there can be computation glitch, software issues or any technical issue arising out of the algorithms. 

There have been a few examples in the past of technical issues, creating trouble and generating wrong results, but they are the things of the past and could be termed as exceptions and not examples.

Conclusion

The benefits of algo trading can easily overcome the negatives of it, and the benefits are too many to let go of a perfect opportunity to make money more easily and hassle-free. 

The speed at which the technology is advancing, you have to move at similiar pace because as saying goes "Jo Samay ke Saath Chalta hai, Samay uske Saath chalta hai(Those who keep up with the time, time keeps up with them)" ummm forgive me if I messed this up.

There are many algo trading providers you will find in the market, ours is one in the many. 

At Smart Algo, we aim to furnish consistent access to market participants with secure and straightforward innovative solutions. 

We are capable of trading software and programming of strategies. 

We execute our work with professional staff who have incredible information on trading principles, have a good understanding of financial calculations, basic statistics and computing trading execution measurements. 

We execute:

• Automated Trading
• Auto buy and sell signals
• MQL Development
• Strategy development
• API Bridge

Choosing us is your decision, but convincing you is our duty. Well, we can guarantee you:

• Automated functioning - Automated Buy And Sell Signal With Target
• Markets and Instruments - Best indicators for market analysis
• Order Management and Execution Algos - Improving Order Entry Speed and Diversify Trading
• Strategy Development - We develop your strategy with our code

We can also assure you of:

·   Support Team

·   Quality Services

·   Budget Friendliness

Thank You for keeping up with me till now. Hope, it was helpful to you.

If you find it informative, do share it with others.

For more information on our services, you can visit our website "Smart Algo" or contact us.