Some of the advantages of using trading systems are the following: It is possible to incorporate a secure, rigorous and automatic risk management.
- They allow the examination of all the parameters and results of a professional System. This process is called a “backtesting” test. With the possibility of optimizing the necessary parameters to improve the results (expected benefits) under sensible risk criteria, seeking also to strengthen the robustness or consistency over time, that is, the results are repeated in the future. Automatically and intelligently manage Stop Loss, Take Profit, Trailing Stop, pending orders, open orders, open new positions, close … assuming a great intellectual challenge for many.
- The user can decide when to activate an Automatic System. Opting between simply obtaining buy / sell signals (without execution) and that also occurs automatically execution by the computer.
- They offer the opportunity to diversify them into different instruments that are not correlated with each other. Adding a greater degree of diversification by applying different systems (some of them look for trends, others apply scalping techniques, other swing trading, neural networks, variable forecasting, apply in different timeframes, etc). It is an alternative especially valued by investors who can not monitor markets and analyze them 24 hours a day.
- The trader or operator can not simultaneously study a multitude of indicators, turning points, Fibonaccis, supports, resistances and different timeframes (periodicities of the price chart) of several instruments, but an Automatic Trading System is capable and, in addition, can launch the operation “like a missile” in less than a second, executing instantly in a guaranteed way, without the intervention of the human being. Eliminate the weaknesses generated by the human factor, which usually falls to the psychological pressure and irrationality that sometimes present the markets.