The Stock Market is one of the most popular money markets in the world. Almost every country in the world has their own stock market. With technological advancement, the stock market has gone through a lot of changes.
From paper shares to Demat or electronic shares trading to trading with Artificial intelligence or bots is a lot more progress. Day by day automated trading or using bots for trading is getting popular. We are going to explore every aspect of stock trading bots and will discuss some of popular stock trading bots. If you are here to learn more about automated stock trading or use of AI in stock trading, stay with us.
By reading this review on AtoZ Markets, you will understand whether you should go for a stock trading bot or stay with manual trading. According to different sources, it's estimated that 70% to 80% or even more shares on U.S. stock exchanges are traded by automatic trading systems.
various platforms report 70% to 80% or more of shares traded on U.S. stock exchanges come from automatic trading systems.
What is a Trading Bot?
A trading bot is made by programming languages (MQL4, Python, brokers API) to run on a trading platform to give signals or execute trades (buy or sell) in financial markets like stock market or forex market.
But trading bot is not that simple. Only knowing programming languages is not enough to make a bot. You also have to know good trading strategies that are proven in different market situations. Only then you can convert those strategies into a bot.
The more specific and more accurate your strategy is the better trading bot you can make. So basically the more intelligent traders you are, the better would be your trading bot. Also you need to regularly update your bots according to the market situation.
Based on your defined rules, bots will give you signals to take a buy or sell or to take an exit. You can also leave everything to the bot, it will take entry and exit of its own.
Based on your strategy and requirements, you have to choose the programming languages. If you want to use broker API to build an EA or bot, you can use C++, Java, Python, R and MatLab.
Try the stock trading bot with a reputable broker on a free account:
Many stock brokers support MetaTrader 4 trading platform. In that case, you can use MQL language to build your bot.
The selection of programming language(s) for an algorithmic/AI trading system is not simple and needs reflection. The main factors to consider are performance, ease of development, resiliency and screening, separation of issues, familiarity, maintenance, source code availability, licensing costs and maturity of libraries.
What is a Stock Trading Bot?
Stock trading bots let the stock traders buy, sell, and trade stocks and other securities automatically utilizing a bot that carries out trades immediately based upon a specific trading method, with the purpose of automating the trading and making profits. Stock trading bots may include AI stock trading and back-testing features.
A stock trading bot could be a good choice for traders who understand coding as they have the opportunity to develop their own bots. It's essential to look into the crucial aspects of a trading bot and ensure backtesting approaches are in location to validate the bot's efficiency.
Also if you don't know how to program a bot or you know how to program but don't know how strategy and all work, you can buy stock trading bots and use it. We are going to give you some of the popular stock trading bots review in this article. Keep reading.
Stock Trading Bot Reviews
In this stock trading bot review, we have decided to explain a few stock trading bots that are quite popular in the market.
- EquBot
image credit: Equbot
In 2015, EquBot was founded by three U.C. Berkeley together after graduating with degrees in engineering and investment management. In 2016, they managed IBM to onboard with them. IBM came with their Watson computer platform. EquBot has two products:
1. AI Powered Equity ETF (AIEQ). It's for US institutions or investors.
2. the AI International Fund (AIIQ). It's for the people living outside The USA but want to use AL for their investment.
Most of the sophisticated world institutions have entrusted EquBot with 1.7 billion dollars of assets. Everyday EquBot does analyze 1 million news articles and many other data sources. Assets managers, Asset owners, Banks, wealth managers and personal investors can take the benefit of using EquBot.
If you are a personal investor, you can harness the power of EquBot AI for better investment outcomes through AI Powered ETFs.
EquBot is not like other bot services that you can subscribe to. You have to invest in their products. You can not have control over the execution of trades.
- Trade Ideas
image source: Trade Ideas
Trade Ideas was founded in 2003 for the USA and Canada for day trading. Trade Ideas is an effective stock scanning AI-powered concept generation platform that offers 30 channels of trading ideas & 3 automated AI systems pointing trading signals for day traders. Trade Ideas pledges and delivers the nirvana of market-beating returns.
Trade Ideas is best for active US and Canada day traders seeking real-time AI-driven high probability trades, exceptional stock scanning, and a live trading room to find out trading strategies.
Trade Ideas has 3 AI Trading Algorithms that you can use to beat the Market. It gives a Holly Al stock trade free every week. It has a fully automated backtesting facility. It gives you an auto trading option with AI signals. Trade Ideas also give the subscribers access to live trading rooms. The interface of Trade Ideas is kind of old school. It doesn't have any mobile app, only desktop and web version.
They have two subscription plans. Standard Plan costs you $118 monthly while the Premium Plan prices $228 per month.
- TrendSpider
In 2016, Dan Ushman founded TrendSpider company. It's one of the fastest growing companies that create automated technical analysis of stock charts. TrendSpider uses artificial intelligence (AI) with mathematical computation to find trends that can't be seen with naked eyes in charts.
TrendSpider AI does multi time frames analysis with trendlines, and Fibonacci on stock charts. They have a great backtesting engine.
Some of the features of TrendSpider are:
- It detects trend line automatically
- It shows multi time frame analysis on charts.
- It has a very powerful backtesting facility.
- It automatically detects Fibonacci Trend on Stocks, ETFs, Indices and Futures.
- It has auto artificial intelligence candlesticks and chart pattern detection ability.
TrendSpider has 3 Plans
- Advance Plan
Monthly subscription for Advance Plan is $131 with 7 days free trial. If you take a yearly subscription your monthly cost would be $109.17 ($1310 yearly).
- Elite Plan
For an Elite Plan, you have to pay $87/Month. But for yearly Elite Plan subscription fee is $870 Annually (Per month cost $72.50)
- Premium Plan
This plan is for SEC defined professional investors. The monthly subscription fee for Premium Plan is $44. For a yearly subscription you have to pay $440.
All plans have a 7 days free trial.
- MetaStock
MetaStock is also a very popular stock trading bot. It's one of the oldest Expert Advisors. Over 30 years, MetaStock has been giving service. It does technical analysis and charting over 600 types of charts and indicators including Stocks, ETFs, Indices, Bonds and Currencies charts. It also has AI driven backtesting and forecasting abilities.
Some of the features of MetaStock are:
- It has a large number of automated EAs for different markets.
- It has an amazing backtesting facility.
- It does forecast stock prices.
- A large number of add on strategies.
- Good for real time news.
- They have amazing customer service.
- It works both offline and online.
MetaStock has a large number of products with different pricing models for different stock exchanges. You can visit their website and find the suitable products and plan for you.
Try these stock trading bots with a reputable broker on a free account:
Stock Trading Bot Pros
Let's find out what are the advantages of using stock trading bot for your trading.
Minimizing Emotions
Emotions play an important role in any kind of trading. Stock trading is no exception to this. Trading Bot can help to minimize your emotions while trading. By having control over emotions, you can have better execution of your trading plans. Fear and greed are two dangerous emotions in trading. Automated trading helps you to remove those emotions as you don't have to get involved in decision making. Over trading is also a bad habit. Automated trading systems can help you restrain from overtrading.
Backtesting
Backtesting is an important feature of any trading bot. Don't subscribe to any bot that doesn't have a backtesting feature. Backtesting helps you to apply the bot on historical data of any stock to determine how the bot works. You also better find a bot that allows you to test on a demo account. It's not a good idea to test the bot on a live account without understanding how the bot works. Also not all bot may suit you. By backtesting, you can find the right bot for your stock trading. Backtesting also gives you an idea about winning percentage and risk reward ratio.
Maintaining Discipline
In bot trading, discipline is maintained even in volatile markets because trade rules are developed and trade execution is carried out immediately. Discipline is frequently lost due to emotional aspects such as fear of taking a loss, or the desire to make a bit more money from a trade.
Automated stock trading helps us make sure the discipline is preserved because the bot will follow the trading plan as instructed.
Another challenge in trading is sticking to the plan. It's really hard to carry out the plan if you are not disciplined enough. But with automated trading, it's easier to be disciplined.
Cost Effective
Using a stock trading bot or automated trading system can reduce your trading cost significantly. If you are a good analyst, that's a different story. But if you need an expert for market data analysis, then trading bot is less costly than a human trading expert.
Try a stock trading bot on a free trading account with an AtoZ Approved broker:
Order Entry Speed and Efficiency
Stock trading bot responds to the changing market immediately. But as human beings we can't respond to the changing market as quickly as a trading bot. Sometimes a few seconds early or late entry or exit from a trade can make a huge difference in the outcome of the trade. AI trading bots also save your time. It takes a lot of time to analyse the financial data and technical aspects of a stock chart. But with a trading bot, this can be done in a few minutes. As it saves time, you can use your spare time for other productive work.
Trading Diversification
AI trading bots allow the user to trade on several accounts or various methods at one time. It also allows you to spread potential danger over numerous instruments. It would be extremely difficult for a human to run several accounts and methods effectively. The computer system has the ability to scan for trading chances throughout a series of markets, produce orders and keep track of trades.
Developing Trading Strategy
Utilizing automated trading systems assists you to develop unique trading experience. There are Some platforms that are known to supply different tools and resources to improve their clients' abilities even more. AI stock trading bot can be an excellent tool for novice traders who wish to scan the marketplace effectively. It's likewise an excellent aid for skilled traders who have actually refined their trading methods and utilize the bot to increase their ability to generate more returns daily.
Stock Trading Bot Cons
Yes, stock trading bots have some advantages. But it also has some disadvantages as well. Learn about those before making your decision.
Mechanical Failures
Though automated trading seems very easy. Set up the bots and run it. But sometimes software can have technical errors like server issues. You can get disconnected due to power failure or any other reasons from the software server end.
Unpredictable Market Changes
Stock market is unpredictable and ever changing. A stock price can drastically fall due to some negative news of that company. Sometimes your AI bot may not be able to cope with that sudden news. Sometimes due to huge traffic, your broker may face delay in execution of a trade. For this charging situation, you need to prepare and take action according to the market situation. If you have no idea about the market and don't know what to do in certain unforeseeable situations, you may lose a lot of money. So it is not a wise idea to depend on an automated trading system blindly.
Need Monitoring
Though it seems an automated trading system doesn't need to be monitored. But it's not entirely true. Some unwanted situations may arise that may need your manual intervention in your trading. Otherwise, you may have to lose money.
Lack of Understanding
You can buy the best available AI trading bot but if you don't understand the bot properly, it can cost you negatively. You have to understand every detail possible of the bot you are going to use. That's why automated trading is good for those who understand both algorithms and the stock market. As legendary stock market billionaire Warren Buffett said, "Risk comes from not knowing what you are doing". So know your trading bot well.
Avoid Scams
Where there is money there is scam. Many automated trading systems claim unrealistic profit margins. If it's too good to be true, stay away from it. Try to know everything about the system. Don't pay without knowing how their payment system works. Check all the user reviews before landing yourself with any trading bot. Use the free trial version before making any purchase system to make sure it suits you. If you are a complete novice in the market, it's not a wise decision to go for an AI based trading system.
Think twice and ask yourself whether trading bot is for you or not. Don't buy any bot just because it promises you to make a lot of money. It may not be that easy or quick money that some may promise you.
Like these AI trading bot and want to try them out? Do it with an AtoZ Approved broker for free:
Conclusion
Using an AI trading bot can be a good option, if you are not completely new in the market. It may seem very promising to make money by using an automated system. But you need a good understanding of the stock market and trading bot.
Even if you are an expert in trading, it should be a replacement for manual trading. Remember a bot can't do anything of its own. It only follows the predefined rules and acts accordingly. Only the future will tell whether AI based trading will be able to completely replace human beings or not.
Should you use a stock trading bot on your own at all?
Before you start trading with a stock trading bot, you'll want to read this.
Our in-house trading expert Dr Yury Safronau, PhD in Economic Sciences, gives you daily his best forex, metals, and cryptocurrencies to buy and sell signals right now.
His trading strategies which are based on non-linear dynamic models have achieved more than 65 000 pips of profits since 2015. And right now there are some very strong buy and sell signals across several markets you don't want to miss.
Want to see which ones?