Automated trading vs Manual Trading

Hello Friends

I am starting this thread to discuss about Automated trading and manual trading which type of trading is best and why?
As technology has grown to a new level now a days it is making the life simple for humans with the help of machines .So in field of financial market we have Algo trading,EA etc. So which one you think is the best Modern automated trading method or old classical manual Trading If you are a Manual trader or an EA user Please share your experience,Suggestions and opinions about manual trading and Automated trading..

Depend on whether you are news traders or technical traders.

I personally do not trade on news or reading fundamental news.
My trading style is 100% technical and based on 100% mechanical system.

For the first 3 years in my LIVE trading (2010 to 2012), I only used manual trading system as I believe if it is true that EA can really make money and profitable, then there are no poor people in this world.

Since Jan 2013, somehow my mind was changed, as i realized that there is no different in term of the results or profitability of a 100% mechanical system, whether I trade manually or automated. And this is where I start to go for EAs. So how come there are still many poor people in this world? I am still looking for the answer in this thread: Who has made BIG money with big trading account consistently? http://www.forexfactory.com/showthread.php?t=421338

During my experience with manual system for past 3 years, sometimes when I find a good strategy, it works for a while, then I am happy. but when it doesn’t, its very easy for me to lose confidence on the system and start making bad trades after bad trades. Before I realized it, I am 50% down in my account capital. There is no way I can know whether the system will give more winning trade in future. End up I have changed more than 10 different strategies over past 3 years and my account experience 70% capital drawdown.

When I'm trading EAs, I will first backtest the EAs for 13 years (2000 till 2012) to see how is it performing. Understand that backtesting is not accurate and may give better and more profitable compared to real LIVE trading. I will minus out 10% - 20% for the profit and add on 10% - 20% for the maximal drawdown. If it fits my trading goal and criteria, then I will going LIVE with this EAs. This give me more confidence to stick with the same system even though I experienced consecutive loss, as I know the winning trades will coming soon.

There are 3 main types of EA:

1. Trend Following
2. Scalpers
3. Martingale

There is no “Best” type of EA. The market conditions change all the time, so your best bet is to have more than a strategy. For those with smaller risk appetites, you would be quite safe just sticking with good Scalping EAs and Trend following EAs. Martingales work by a double-up-if-you’re-wrong approach, and are good in delivering a stable, predictable growth, but only if you don’t run out of money to double up.

For me, I will only go for trend following EA at this moment.

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My challenges to make consistent profits - 101ForexCurrencyTrading.com

Hello Aeron

Really a nice opinion to think about You made clear that Automated trading and manual trading both are same at some extent sometimes both will work sometimes both will not

Thanks a lot mate

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In opinion, it doesn't matter which is the best between automatic and manual trading, because it depends on the system in it. But if we applied the same system on both automatic and manual, I thinks automatic trading is the better one. Automatic trading will reduce your trading stress and save your time.

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fx robot

prefer manual trading ... Or trade with EA, with a clear algorithm work with sl + and tp.
nothing more.

There is no different for automated and manual trading. IMO, if you are trading manually, trades are based on some rules and conditions. So why do not use EA to trade for this case because EA can reduce your work load. So you can have more free time to do other stuff.

Hi Bull.bear.
My experience is the complete opposite.
My findings after almost 9 years of manual trading and almost 4 since I started to look into automation
is that manual and automatic trading need to be taking with a complete different approach.

Regardless if a manual strategies are simple or complex, it always involve discretion from the trader.
And that discretion is impossible to code.

For automatic trading the only viable approach is mathematical and/or statistical. Absolutely no indicator.
So, it is not an easy task to come up with a good auto code.

That is why almost 100% of the EA up there fail as they use some kind of indicator. The best you can ever
achieve with this is a super fitted curve to the past data.

At the end, anyone that trades for a while does both. Only if they have developed their own auto strategy.
Also, I do use a lot of scripts and tools EA that assist in the trading. Could be called hybrid or something like that.
J.

I don't get you. Is EA cannot be coded or EA doesn't work 100% due to millisecond of calculation, decimal value?

.
It is long to explain.
In essence, all manual trading is based in some visual.
Can be a visual of a naked chart (price action)or a visual of lines or guided by
some indicators. ... So, the impossible part is to make the "algorithm" of what we see.
If you "look" at a chart, you can visualize same pattern... but in reality a computer
will never see them the same, unless you code to see them the same.
And that is impossible or at least infinite work.

Also, that is why all strategy works only for the person that create it. You can have all the "rules"
you want, but it comes to explain them, define them or make algorithms, then you realize
that use a lot of discretion. And to make algorithms for discretion is also impossible.

The point is that an Effective manual strategy can not be translated into a good code.

Manual or automated are both good... but the strategies for automation are different then manual.

J.

I don't think this debate gonna end! Better I open a poll and see which type wins!

(Democratic style)

Haha....alright.
I think it is possible to code. Is the matter of how "HARD" or "EASY" for coding the EA. Although i am not a good programmer, but i manage to code what i need so far, as long as it is a step by step trading procedure. I think the hardest part would be Elliott wave, required to code many scenarios with different outcome. In order to code easier, faster and simple, i used to store many functions into text file, then when i required the functions, i just copy and paste it into EA, then i would just to do some arrangement and manipulate each of the functions by calling them.

Which one do you think is better? We all know that automated and manual trading both are good ,But my intention is to bring the best out of two

My opinion is related to skilled programmers who "slip" into auto-trading coding and "genius" algorithms.
(I'm a seasoned software engineer with a lot of experience in industrial MES - manufacturing execution systems).

What I find astonishing meeting "auto-trade-geeks" is the amount of energy they put into creation of brilliant algorithms in their effort to "trick" the market and make a dollar. Most of the guys that do auto are more or less concerned to avoid the psychological and emotional burden of profit/loss chain of events that occurs in manual trading. It is true though, that manual day-trading requires a lot of nerves or mind-set to adjust to the "game" of money.

But when you turn to trades with 3-6 months horizon (even not using leverage but changing your currency account - buy cheap currency, sell expensive currency - a very low-risk strategy), it turn out to be much more profitable and do minimal nerve-racking.

Again - this is my opinion. It is really a child-brain effort to do 15-20% per year this way using 2-3 pairs on a half-year-swing entry points with minimal-to-negligible risk. It is even possible to avoid "closing losing trades" - just wait them to get profitable.

So my question is - why the hell a skilled software engineer should waste so much time (sometimes years) in order to "cheat the market", but instead try to use the benefit of their big salaries or perhaps launch 2-3 small online start-ups and for 2-3 years consolidate a $100-150k capital and start a low-risk trade?!

My answer is - such guys do not want to make money - they want to prove the paradigm that "the small geek can tricks the big bad banks" - well guess what - in my 35 years of life-span I realized that the big always win - you could gain by participate in their game and "scoop" something for you, or you will be hard-trying to row against the stream in the river full of shits of the life :-).

That was my opinion. There is no "best".
It is not a question if manual or auto is good, bad or best... It is a question if an "strategy" is good or bad or best.

Manually ( I agree with MichaelPelly) It is easy to make 1-2"% per month average. "Any" strategy and some "common sense" will do.
But that "common sense" is the one can not be emptied from someone head to a code.

So, the problem is a lack of good "strategies" for auto trading. Mainly because everybody focus in "indicator" based strategies
which required "discretion" and not mathematical/statistical, wich are the only ones could be effective in automation.

J.

Currently working on my own EA which will sort out my intraday positions, so In my opinion both techniques could be use successfully.
Still I believe EA needs to be use in certain market conditions therefore human presence and decision making process should be left for us - humans.

Semi-automated one or ...
http://thetraderfx.blogspot.com/2013...d-trading.html

I still think it is better to work independently, because the market itself is very mobile, it is known to every trader, each of us knows how much news appears every day and how much they affect the situation as a whole. Plus, too many assets are connected and sometimes only one news can shake the ALL market . And of course no robotic system or automatic trading can guarantee the safety of your money. It's more the opposite. And when you personally see the situation, you can make a decision - to trade with you or to pause and wait today. This is your freedom and your responsibility. And I think it's much better.

I found this old thread, I strongly feel like automated trading wins, manual trading sucks big, it's been 4 years for me to learn manual trading, I just say that manual trading is from hell. I have spent many thousands on courses and communities to learn effective strategies and techniques, but I still keep failing funding challenges while others pass them and get funded.

I can't believe that some people make money with it so easily, it's mind-boggling. I chose algo trading and that's how it's possible to make money IMHO.

Trading automatically with any EA can sometimes be riskier, but heavy optimization and testing can reduce risks a lot. Guarantees don't exist in the market.

I trade manually, although the most difficult problem is discipline in implementing the trading system, whereas automatic trading has no emotions and only works based on algorithms written into the codebase by programmers. In my opinion, manual trading makes it easier to control risk.