Robots and Automated Trading
The use of binary options robots – “bots” – and other automated trading software and apps has exploded over the past few years. Here we explain how a trading robot works and review the top services 2020, and list what you need to know and what to expect as a user. We also show where to find a Robot demo account to test the service, and teach you how to use the auto trading software and tools.
The best auto trading service for you will be down to personal preference, so read on to get all the facts.
Top Robot & Auto Dealers in India
| Robot | Information | Bonus | ||
|---|---|---|---|---|
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BinBotPro | Choose from 20 robots and compare them on past performance. Activate automated trading in just 3 steps. | “go to | |
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Binary.com | Regulated broker with a tool for creating robots, offering a huge range of features. | Exclusive $20 Free | “go to |
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OptionRobot | Free to join with flexible settings including indicators, expiry and methods. | “go to | |
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AutomatedBinary | Free demo account and a choice of money management and algorithms. | “go to |
How does an auto trading robot work
Robot software and auto trading algorithms combine a signal service with automated trading. So the software will try to identify profitable trades, and then place the trades automatically. This automated element takes signal services a step further, and actually places trades instead of leaving them to the trader alongside. These systems will have different levels of risk management – from stop loss to daily fixed spend limits. The automated element, however, increases the financial risk for traders overall.
There is also a growing trend for brokers to provide their traders with the ability to configure their own ‘bots’ or automated trading systems. These simplify the process, allowing traders to “drag and drop” technical indicators into their system. Features of the best bespoke robots allow traders to run their robots on a demo account, to test it risk-free.
Brokers are eager to promote robots, as they create higher trading volumes, and hence reduce the risk for the broker. They can also be a great tool for traders – but as ever in binary options – any promise of profits is an immediate ‘red flag’. Robots, such as the binaries themselves, need to be fully understood before use, and they are not a path to guaranteed profits.
Will a Robot Make You a Better Trader?
Sometimes. Trading robots will have swings just like any other trading method. Similarly, the settings that the robot is operated on may become less (or more) effective over time. So they will need to be constantly monitored for performance.
Automated trading without doubt increases risk – and binary options are already high-risk investment vehicles. But an automated bot running unchecked can rattle through a large number of losing trades, especially where a news event affects the market. An event that might repel a human trader from the markets is not going to stop an automated robot.
This additional risk can be managed to some extent. Many bots will have daily loss limits and overall limits. They can also be set to stop if a certain level of profit is reached. Traders should however be aware of all the pitfalls and respect the bot.
Auto Traders Review
binary.com binary.com
Binary.com also offers the facility to design and run an auto trading robot. Long a broker for advanced traders, Binary.com now offer a range of ‘advanced platforms’ – one of which includes the Binary Bot platform (screenshot below).
This platform gives traders the ability to put together an automated trading system. As might be expected from this firm, the feature offers more depth than some of their rivals – again appealing to advanced users. The parameters available to put together an algorithm provide more options than anywhere else. The process allows for additional layers of complexity to be built in, allowing users to be very specific about their trading ‘triggers’.
Binary Bot follows the binary.com look and feel, which is quite unique. The visual ‘fluff’ has been trimmed back, and replaced with brand specific features and usability. Read more about the platform in the Binary.com review.
Other Auto Trading Software
There is a small manual element required in setting up auto trading software, but once that is done – as the name suggests – trading is automated. This form of trading is generally similar to robot services. A trader using automated software will first setup the software based on the type of trading they are interested in. So the level of investment, the type of asset to trade and the level of risk. Once configured, the software can be left to place trades based on the settings given.
Signals – essential for auto trading
In theory, signals and automated trading are the same. The difference is that when the auto trading software spots a signal, based on data analysis, it will open a trade. A signal provider will simply highlight the trade opportunity, but leave the actual opening of the trade to the user.
Automated software therefore, generates signals based on the algorithms it uses, and will open and close trades based on those algorithms.
copy other traders
There are also services that will allow trades to be opened based on a real life binary options trader. Providers will provide a list of live traders, and publish their results. Users of the platform can then decide to copy those traders – choosing the level of risk and investment that best suits their needs. This kind of “almost auto trading” is called copy trading.
Robot and Auto Trading Scams
The automated nature of this style of trading is fraught with danger. If ever a trader hands over the control of his trading to someone else, the risk level increases immensely. Our scams page has some details of red flags to watch for (including a list of scam services), but auto trading in particular attracts a lot of scam operations. Here are some reasons:
- Novice Traders – Auto trading software is often aimed at novice traders, or those who do not have the time or knowledge to trade on their own. This group is probably easy to mislead, and hence they are targeted.
- Easy to blame the merchant – linked to the first point. Unscrupulous providers will simply say that the software was misused, and therefore was not at fault.
- Control – If traders put someone else in control of their trade, it is very easy to say that money was lost.
The warning songs of a scam include a lack of transparency (results that are not true), forcing users to use a particular broker, and the most obvious – promises of guaranteed or very high profits. If it were easy, everyone would be doing it. Tread very carefully when proceeding with auto traders. The risk of scams is considerable.