The Fully Automated Trading System
The importance of a fully Automated Trading System lies in the purpose of Forex trading, which is to make a profit from purchasing and selling foreign currencies. Events that occur in the economic and political sphere have a great influence on the demand or lack of demand for a certain currency.
An Automated Trading System (ATS) uses the fluctuations of a foreign currency like the U.S. Dollar, to buy cheap and sell at a higher price to make a profit. It is a computer program that sets buy orders and sell orders on the exchange. The bot is programmed to implement the set rules of its trading strategy. This strategy is based on technical analysis as well as input from other electronic sources. The Automated Trading System never stops trading and can outperform any human trader. It also increases the level of traders’ sophistication.
An Automated Trading System is a great tool for traders since it is based on algorithms and can automatically manage one’s Forex portfolio. In the U.S., more than 75% of stock share trades are conducted via an ATS. Another advantage is that the bot also protects your funds by automatically setting stop losses. These bots are tested by means of backtesting software and using historical market data. Once the desired results have been obtained, live testing is conducted and compared to the backtests. The following is taken into consideration: Profit Factor, Percent Profitability, Maximum Drawdown and Average Gain per Trade. If the bot exceeds the backtested performance, it is ready to be fully implemented.