Automated trading has been around for quite a long time and has always had its share of pros and cons. Loved by most traders, a trading robot can be extremely difficult to get right. If purchased right, they can take you to great profits. And it doesn’t matter what type of business you run, you would want to make the right investment decision.s
If you end up with a bad trading robot, you may lose every penny that you’ve gained in all this while. If you’re planning to a trading robot yourself, here are five tips to find the most reputable one.
Do Your Research
Always look at several trading robots before finding the right one for you. Every trading robot website makes claims of making you rich instantly, but how are these. You can easily get the answer to that by reading the review of the same online. Apart from that, you must also check how long has the system been in for. If it has been more than two years with good consumer testimonials, you’d be saved from losing your money.
Look for Live Trading Results
Most websites possess a great winning ratio of 90-99% on their robot. This looks like a possibility as these robots are tested in the simulated environment. Simulated environment varies a lot from the real one, as it checks only ideal scenarios leaving the possibility of accurate results.
The websites mentioned it only in the fine print, which is why most traders miss it. Therefore, you must check for the live trading results of any trading robot before investing in one.
The robot that you’re purchasing must also have been back-tested on several currencies and different market situations. This will help you understand how the robot works better in different situations and the kinds of losses and gains it’s capable of. If any seller avoids running backtests or won’t let you have on with their robot, chances are very high that you shouldn’t be buying it.
Keep an Eye on the Drawdown
Every trader has a different capability of dealing with a drawdown. Some of them can bear about 25% of their portfolio only, while some stay strong even at 50%. Therefore, it becomes crucial to see that how much of drawdown is your robot capable of. The drawdown also needs to be consecutive, instead of a one-time thing. If the numbers produced by the robot seem to be too much for you, it’s better to drop the idea of that one. Take a look at the top 10 crypto robots here.
Check the Order Size
The order size of a robot may vary its results as every robot functions its best on a particular order size only. Always check your robot on multiple order sizes before buying one, so that your profit doesn’t vary much with the change in size. If the difference in the probability of gain or loss is too high for the change in order size, you must stay away from the given robot.