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RE: STEEM (SBD) Trading Bot Growth Hack Project Outline

in #bitcoin7 years ago

It's true the majority of the orders places in the markets these days is done by bots running algorithms, however their main job is to place huge orders when ever a market is within a specific range so the bank/broker has product for their clients to trade. As far as investment funds using bots to make orders in the market with the hopes of profiting from the trade alone is very low. See bots only ever work in specific market condition, it takes a skilled trader to know when to turn them on or off. To this day their has never been a bot able to match the profitability of the most skilled investors! This is why less than 20% of the trades made by investment funds are made by bots. The 20% who are profitable using bots to trade are trading high frequency and they are taking advantage of being faster than their competition. To do this they need to be trading very close to they exchange, every pikasecond counts. The people who are selling automated trading systems to people with little - no trading experience are selling them a dream. There are no profitable systems that you can just turn on and start making money without taking on huge risk.

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*As far as investment funds using bots to make orders in the market with the hopes of profiting from the trade alone is very low. *

You are kinda of right but 98% of funds don't beat the market. I suppose that is why quant investing is the biggest new trend for hedge funds. Which is different than HFT where you pay exchanges fees to get preferred lineup in the queue.

See bots only ever work in specific market condition, it takes a skilled trader to know when to turn them on or off.

I wish I knew when was the time not to trade and when is but that is impossible. I can only reduce risk. To do this the only time the strategy is not traded is:

-All pairs during US Federal Reserve interest rate decision or Meeting Minutes release.
-For all other Central Bank Rate decisions all pairs with the currency of the country. For example during ECB interest rate decision any EUR pairs are avoided.

To do this they need to be trading very close to they exchange, every pikasecond counts.

Yes, if you are trading HFT. To say that is the only way to profit from the market is baseless and false. This strategy is traded off the 8 hour time frame updating orders every hour making latency irrelevant.

There are no profitable systems that you can just turn on and start making money without taking on huge risk.

There is definitely greater risk trading discretionary with your emotions involved than an automated program designed to reduce risk and follow rules. There is ALWAYS risk.