A pairs trading terminal provides the option to select specific assets to create a spread. You can easily switch from Classic Trading to Spread Trading by adjusting the strategy type in the terminal, which is located right after choosing the exchange. By utilizing our crypto auto trading bot, spread trading significantly reduces volatility during the trading process.

Paper trading is a risk-free simulation of real trading used for practice and learning. Try all features of Automatedbottrade with a demo account.

Trading bots are not free to use, and even though the long-term profit will make up for any maintenance costs, you still should keep them in mind while developing your trading plan. What’s more, some traders would rather build their own system from scratch, which can be more secure but cost much more money to set up, exceeding all the profits the system may bring you. Additional expenses, such as the cost of a virtual private server to ensure smooth and uninterrupted 24/7 trading, should also be taken into account.

Grid trading refers to a bot trading strategy that involves choosing multiple price levels to execute trade orders at. Once the price touches one of the price levels, the bot automatically initiates a trade. Each buy order has a corresponding sell order placed a couple of levels higher, which resembles a grid. This strategy is rather straightforward and shows good results in markets with normal price volatility. Arbitrage trading. Arbitrage trading bots monitor two different exchanges and capitalize on the differences in prices between them. This strategy involves making highly frequent and fast (sometimes lasting only a split second) trades and is generally associated with low risk, though there’s still a danger of slippage, which happens when the trade is executed at a price different from the requested price due to market volatility. Momentum trading. This trading strategy revolves around trading within the current market trend. Trading bots gather data about the volume of traded cryptocurrencies, market volatility, time frame of the trend and to identify its strength and direction. Then, if the data indicates that the trend hasn’t lost the momentum and is still moving in the same direction, the bots will place new trades until the momentum is lost. Mean reversion trading. The mean reversion strategy is based on the idea that the price of an asset will always revert to an underlying stable trend after a period of market volatility or prominent price fluctuations. This strategy aims to capitalize on long-term and extreme changes in the price of an asset with the assumption that it will revert back to the previous trend. Trading bots can calculate this trend and plan your trades around it while also taking into account how the current market movement can affect the mean average underlying trend. Knowing these strategies can help you understand better how automated trading systems work and what they are truly capable of doing.

If you want to minimize the risks for your trading or investing portfolio, you can try and diversify it by investing your money in a variety of different assets at the same time. This allows you to protect your capital if one of your open trades or investments falls through. However, it is hard to keep up with one market, let alone several, so many traders and investors don’t use this opportunity. This is another thing trading bots can help you with. They can monitor multiple trading accounts and apply different strategies to different markets. When one position starts to lose, they can quickly detect it and reallocate money to different trades or open new ones. Automated trading allows you to take advantage of trading opportunities across multiple markets without having to endure the stress from trying to juggle several trades at the same time.