Imagine what if you get all the information about any stock market which is operating around the world just by clicking in your cell phone or computer. Then, this can happen through automated trading systems. An automated trading system is a part of algorithm trading which uses a predefined computer program through which you can place your order automatically through your mobile phone, laptop, or computer while sitting at the comfort of your home.
This software works on pre predefined set of rules which is formulated with proper technical analysis, mathematical, and statistical computation. This trading system stops the entry of erroneous orders as a result of its error and mistakes which are done by humans are eliminated. Moreover, it eliminates human emotions in trading as well.
Quantitative trading systems are working on a very simple formula, i.e. underlying theory. This strategy works best in the future. It simply tells you that if the company is performing poorly in the past year is likely to perform poorly in future too. The trading system showcases this information in a graphical way, like in the form of graphs, charts, pie, and various other forms.
An automated trading system is one of the best decisions you should go for. Below given are some of the reasons that will tell you why an algorithmic trading system is a one-stop solution to do trading.
- Backtest: Backtest is accomplished by reconstructing, with historical data, trades which have occurred in the past using rules defined by a given trade strategy. The automated trading software automatically evaluates the rules using old data and information. Also, The investors increase their level of performance by minimizing mistakes and ultimately increase the Return on investment you do.
- Enhance consistency: Each and every share market investor wants consistent Return on investment. Trading strategies systems work on the basis of preset rules which help to provide a fixed return on each investment you purchase. Also, Prior planning and decision help new investors in doing trading.
- No space for emotions: As we all know, while dealing in shares, we must keep emotion aside. A preset of rules and procedures do not give you the chance of making emotional decisions. You can analyze last year's performance of the company and the rate of Return which the company has shared with its shareholders. This feature will help in eliminating the risk involved in trading activity.