You Require An Automated Forex Robot To Trade Successfully The Forex Markets
Have automated Forex system become important in the trading markets
?In order to properly answer that question, we need to look at how the Forex Market has grown.. From that perspective we will understand the importance of automated systems.
It is general knowledge that The Forex market in terms of daily turnover and revenue per trader is the largest in the world. It is also the largest market in terms of players.
The following are some of those that regularly trade inf the Forex markets for one purpose or another.
BANKS- are more than deposits and loans, in fact they are a major participant in the currency markets.. Banks cater both to large quantity of speculative trading and daily commercial turnover. Large banks can trade billions of dollars in the Forex markets daily.. Some of the trades are undertaken on behalf of their clients, but most are through proprietary desks.
COMMERCIAL COMPANIES- these commercial companies trade minor quantities of foreign currencies compared to larger banks and their trades produce small and short-term impact on the market rates. Nonetheless, the long term trends of exchange rates are influenced by the transactions of the commercial companies.
CENTRAL BANKS- central banks play an important role in the Forex market. This results from the fact that they control the supply of money, interest rates and inflation.. more significantly they set ranges that they would like their currencies to trade in.. One of their functions of central banks is to stabilize their currency through the purchase and sale, or intervention, in the foreign currency markets. Their actions usually prove adequate to stabilize their currency.
INVESTMENT MANAGEMENT FIRMS-The managed by these firms include pensions funds and endowments and are typically very large.. They are using the Forex market to facilitate transactions, specifically in foreign securities. For example, an investment manager bearing an international equity portfolio needs to purchase and sell several pairs of foreign currencies to pay for foreign securities purchases.
RETAIL FX BROKERS- are responsible for fraction of the Volume of the Forex Market.. Forex estimates retail volume of between 25 to 50 billion dollars each day, which is estimated to be at 2% of the total market volume.
SPECULATORS- These are the participants who speculate and profit on price fluctuations during a given period of time. They play an important function shifting the risk to individuals who do not want it..
In Forex market alone, these are the six major players participating in the $1.8 trillion worth of daily volume. With a large number of Forex players, there is really a need in switching from manual to automated Forex trading system.
To the aforementioned major Forex players, the automated trading system is of great benefit to the speculators. Their principal objective is to catch price fluctuations between the currencies and make a profit from them, the automated systems allow them to stay ahead of the markets.
There are several automated Forex trading systems available in the market. There are also automated Forex systems that are offered for free or as part of their trading account acquired from their Forex brokers or agents. These systems are plain trading systems that do not approach the sophistication of the trading robots. Additional features are not typically free and get more expensive as more are added.
The two systems for Forex trading are:.
Forex system that run on your PC and data is stored in your hard drive. This system is unpopular to Forex traders because all data are vulnerable to computer virus contamination and other security problems. Worse case scenario is if your system crashes and you did not make a backup you have lost all your data. However, it is little expensive compared to the other types of automated trading system.
Web-based system- the security of your Forex account and other data are provided by your web-based provider.These are hosted on secured servers. It is also convenient in the sense that there will be no software required and it is universally compatible with your Internet browser.
Forex robots represent the most intriguing way to trade and have become almost necessary. Your learning curve is greatly decreased and the robot is able to react much faster and can be aware of many more variable then the human eye. Today's markets are characterized by millisecond movements and not using one of these robots will always leave you one step behind.. The demise of most traders is injecting human emotion into their trades, these robots do not have these problems.
by: Manny Alvarez