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The main benefits of AI trading

Artificial Intelligence can be summed up as the technology that acts for itself. Therefore it is perfect for multiple trading applications where speed and efficiency are required. Its implementation will change trading in many ways, and this is already happening.

How AI disrupts the financial trading industry?

I makes a real difference in financial trading by mining essential data and giving cheap and easily available tools that create an advantage for everyone, not just corporations. The investment decisions made by AI will be calculated, accurate, and fair, unlike those made by humans, who are more emotional.

The new generation of trading algorithms will incorporate AI, which will allow them to learn from the trading account of thousands of past orders. This is performed by using machine learning techniques that detect a pattern in the data and make predictions.

As the AI topic looks to be very controversial about how it can be applied to the different systems and with what purposes. Today we want to summarize 8 main advantages of this technology.

The benefits of AI-enhanced algorithmic trading

Algorithmic trading has many advantages, but what happens when you throw artificial intelligence into the mix? This is where things become really juicy, as AI essentially gives algorithmic traders extra tools to improve their performance.

So the main benefits of algorithmic trading are:

  • Increased accuracy

AI can make an understanding of broad datasets that humans would take a long time to process. Systems of this kind can detect trends and patterns with high accuracy and execute decisions in the separation of a second based on such information. They can also make future forecasts, helping to guide investment approaches.

  • The ability to respond to market conditions

Whether you’re trading stocks or FX, the aim is to make an investment. Knowing when to buy and sell is important, and that’s why AI is seriously revolutionizing the sector as it can read and immediately respond to market conditions. This means that if portfolio tweaks are needed to avoid a loss, they can be completed without the need for time-consuming analysis by an investor, which could ultimately lead to investment collapse.

  • The elimination of human emotions

Algorithmic based AI trading can help take the emotions out of investment decisions. Instead, Big Data is used to make trading movements that can’t be affected by subjective human decisions or emotions such as anger, envy, or the fear of missing out (FOMO).

  • Discovering Patterns

Incredibly powerful computers can proceed almost countless data points in minutes. This means they can also identify historical and replicating patterns for smart trading that are frequently hidden to human investors. Humans simply aren’t able to process that much data or see these patterns at the same rate of technology (if at all). Consider that AI can estimate thousands of stocks in moments. According to CNN, some hedge funds use AI to solve as many as 300 million data points on the New York Stock Exchange in the first hour of daily trading alone when it comes to high-frequency trading.

  • Predictive Trading Based On Sentiment

By analyzing news titles, social media comments, blogs, and more, AI can forecast the direction of stocks and the moves of different traders via sentiment analysis — the process of classifying opinions (or sentiment) people have given in the text.

  • Speed In Trading

While not unprecedented, this technology adds even more speed to trading. Now every millisecond is counted. AI means automated trading without needing to call your broker or get on an app.

  • AI is cost-efficient

As it describes investment in R&D at first but, in the long term, it will allow us to reduce the previous expenses. Machines do not need salaries, and will only require support costs.

  • Artificial Intelligence can work without breaks

Thus, it can be used to change us for processes that it’s better not to stop or just do the job in a more continuous way that humans would do. For us, it’s just impossible to think about working 24 hours a day. In fact, we need to have time to sleep and eat, but we also need to take some time off from our work for the simple reason that we can’t keep our attention focused for a long period. Machines don’t have this problem, and when we need a break, they continue working at the same pace with the same efficiency as when they had started to run.

AI trading benefits

AI isn’t perfect.

An Automated trading algorithms system developed with Artificial Intelligence (AI) has distributed its approach into the commercial world quicker than the marketer expected. AI-driven investment platforms have attracted investors to complete by ensuring them secure, stable returns. Simply, this made people assume that AI is the future of trading. Now the world of trading has developed to leverage technology to build a lot of benefits from it. AI can help with data analytics and insights for great resources to create alpha and decrease costs. These technologies have developed across the fields of trade strategy operations and customer commitment.



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Atama.AI develops AI-based trading algorithms that can predict whether asset price will go up or down with some reasonable probability. 2 years of R&D ✓