Trading systems

Introduction

Taking a look of almost everywhere, the trading system is getting more and more sophisticated or automated machines taking over human functions in transacting process/ the most common of these are the new softwares currently in use in many aspects of trading due to their nature of simplifying the whole process thus saving a lot of money and time. Trading system is a term used to refer to the set of rules guidance and indictors that allow the main entry and exit areas/points during the trading process.

Why use trading systems

A study of the human work rate quickly shows that trading can help on saving up time and may even function faster. Due to the tireless nature of machines, they do not require breaks as humans do from time to time. This usually takes up a lot of the work time that could otherwise have been used to transact business. The trading systems can be relied upon to work tirelessly 24 hours a day, seven days a week without any complaints. Looking at the statistics of the work rate and work performed, it would also seem that these trading systems are very cheap in comparison to employ a person.

Where can trading systems be used

The softwares in the market have a wide range of scope in which they can be utilized effectively and effectively. Such areas include the banking the masses, in the forex market where automated trading systems can take and make bids thus facilitating money exchange without human intervention and also in the stock markets where stocks for various companies are traded.

Advantages of trading systems

First, trading systems have no emotion which is usually taken to be the biggest flaw of human interests. Due to fear of risk which may in form of losses, investors may be in a situation where they are second guessing thus end up either losing or failing to take advantage of available opportunities. Second, trading systems optimize time to work ratio due to their effective nature in performing tasks. 

Disadvantages

The major short comings of the trading systems is their complexity. Most trading system require a solid understanding of technical analysis in order to operate them initially and also checking upon their. Acquiring these skills necessary to run the systems is no mean heat second, development and operational of the systems cannot guarantee consuming task. Also, development of the system cannot guarantee operational of the system. The project may fail to launch even after a lot of time and other inputs being put and developing it. Thirds the trading systems do not guarantee to operate without any glitches. Due to the nature of computer of computer systems, one glitch could be very costly in terms of either having them repaired or even in terms of making wrong trading decisions.

Conclusion

Though trading may function generally more better than human beings, it is not just yet time to replace the work force with the systems. The development and operation of the tasks is no mean feat by any standards. However, it should be outed that a well developed system is worth a shot in carrying out the related functions effectively