Automated trading is also a good solution to eliminate 'emotions' associated with trading decisions.

The dominance of technology in our lives has made great impacts in everyday routine. The presence of Artificial Intelligence (AI) in every sector is making things more high-tech than ever. Ultimately, people are also slowly adopting the changes and are expecting more from it. One such industry is trading. People want quick and safe delivery of products they order. Humans can't ensure these without the help of technology. AI is gradually invading more fields in the trading industry like selling cryptocurrencies, converting bitcoins to fiat, or trading stocks and commodities. These are some of the small doors that open big opportunities for automated trading.

What is Automated Trading?

Automated trading is the method of participating in financial markets by using a program that executes pre-set rules for entering and exiting trades. An automated trading system can help individuals or businesses increase their trading efficiency through execution of CFD trading strategies. Automated trading is also a good solution to eliminate 'emotions' associated with trading decisions. The emotions are eliminated because all the rules of trade are already built into the parameters that are already set.

Automated trading, also known as algorithmic trading, mechanical trading systems or system trading enables users to carry out many trades in a small amount of time. With some algorithms, users can even avail pre-determined strategies to follow trends and trade accordingly. The adoption of automated trading is drastically increasing in recent years. For example, banks are cutting back on the trade teams and employing automated trading to carry out the job.

How does automated trading work?

Automated trading gives the whole power to the user. Initially, the user has to finalize a platform and set parameters of trading strategy. The user can create rules, conditions and guidelines based on their market involvement. The next step is to custom an algorithm that needs to be applied on the criteria to place traders on the user's behalf. The automated strategy that is already set will constantly monitor financial market prices, and traders will be executed if predetermined parameters are met.

Even though when automated trading platforms offer a list of top technical indicators on rules and regulations, traders still prefer to program strategies on their own based on their personal outlook of the trading industry. This method of trading offers flexibility and can be extremely rewarding.

Best automated trading software

Automated trading software is a sophisticated trading platform that uses computer algorithms to monitor markets for certain conditions. The best-automated trading platforms share a few common characteristics like access to preferred markets, functional interface, industry-standard programming language and detailed price histories for backtesting. Some of the best-automated trading software are:

MetaTrader 4: Meta Trader 4, the popular forex trading platform from Russian tech firm MegaQuotes Software Inc. has a lot of features to make trading easy. The software was released in 2005 and claimed heavy recognition at the trading sector. Meta Traders 4 can be integrated into almost any brokerage account, allowing users to harness the platform's capabilities without forcing them to open new accounts.

ZuluTrade: ZuluTrade, an online trading platform was founded in 2007. The software has some social elements and the ability to copy trading options and add automation. Regulated by the HCMC, the platform offers APIs for traders, scripts, and auto-execution options. ZuluTrade gained attention in2015 when the platform was awarded an EU Portfolio Management License.

eOption: eOption was created in 2007 to serve at low-cost trading options. eOption has some of the lowest commissions in the option space with a lot of features. The software lets users set up automated trading systems, but there is no programming language knowledge needed. Instead, the platform has a series of trading newsletters available to clients.

The future of automated trading

Hundred percent of automation is what the trading industry is looking for in the future. AI-powered companies are emerging to aid traders to discover the trends and patterns quickly and at an early stage of its commencement. Currently, machine learning, predictive analysis and many other technologies are providing easy trading options. Automated traded is also being increasingly adopted by companies to identify and examine risky investments.

Even though when setting strategies and following rules are a part of automated trading, there is no assurance that the organised criteria will work all the time. The market difference will impact trading if the software strategies are not updated from time to time. Fortunately, some robotic start-ups have begun venturing in developing engines that track and monitor market scenarios and observe trade patterns to help come up with possibilities that could assist traders in creating strategies. The new automated trading methods are expected to flood the market soon. It is anticipated to be more advanced and complicated. However, automated trading has already broken the stereotype thought that banks and large trading companies are the only entities that can leverage technology. Today, even small retailers have jumped onto the bandwidth of algorithmic trading and witnessed significant growth. A huge rise in embracing automated trading is on the way.