Jenna Arnold has always been fascinated by the stock market and the world of trading. Having dabbled as a part-time trader while at university studying English Language, she leveraged her insights into this world into a full-time career as a writer specialising in trading and broker reviews. Jenna joined TradersBest.com last year and now heads all of our trading content, working remotely from her home in Massachusetts.
Futures are a form of financial derivatives in which two parties speculate on an asset’s price and agree to purchase or sell the asset on a specified date and specific price.
Trading futures can be a great way to capitalise on your funds, although it demands a certain level of knowledge and expertise to identify profitable investment opportunities. Luckily, trading futures has now become more convenient than ever, thanks to automated trading systems. Continue reading this guide to learn more about automated futures trading and its benefits.
Imagine you own a business and need to stock lots of cotton for business purposes in the next few months. However, after analysing the market, you realise that the price of cotton is likely to rise by the time you end up purchasing it. In this scenario, you can open a contract with the cotton seller to buy the cotton at a mutually decided price and a specific date. Now, regardless of which direction the cotton’s price goes, you’ll either make a profit or face loss in your deal. This is how futures trading works.
The purpose of futures trading is to speculate on a future asset’s price and enter a contract with another party based on your speculation. Many futures traders don’t intend to buy the underlying asset but instead hold the futures contract as a valuable asset that can be further sold to other investors. You can trade futures on a wide range of financial assets and commodities, including stocks, ETFs, gold, and oil.
Get AtoZ Markets Premium Trading Signals
+30 Premium Trading Signals
Unlimited access to indicators
QA session with an AtoZ Mentor
Sign Up Now!
What is automated trading, and how does it work?
As the name suggests, automated trading simply refers to trading that is done automatically on your behalf. Automated trading systems are becoming increasingly popular based on the convenience they offer to traders. In fact, many trading experts indicate that auto-trading will be the future of investments.
Moving towards the million-dollar question – how does automated trading work? Automated trading systems use special algorithms that identify trading opportunities in the market. All you have to do is enter a few preset rules into the trading system, based on which the software will enter and exit trades.
While automated trading software is highly efficient and makes investments a whole lot easier, it’s essential that you choose an auto trading system that’s well-reputed, user-friendly, and efficient at managing trades while you rest.
Understanding automated futures trading systems
In order to automate futures trading, you’ll have to set a trading budget that you’re comfortable with initially. Then, you’ll have to identify and enter a trading strategy that you’re comfortable with. Based on the information that you’ve entered, a custom algorithm will be built for your investments. That algorithm will match trading opportunities and place trades as soon as your preset rules are applicable.
Considering the time and effort it takes to hunt down futures trading opportunities, automating your futures trades or benefitting from the best futures trading signals can save you a great deal of time. If you’re not experienced enough to enter preset rules, you can go forward with automated copy-trading as well. Copy-trading allows you to copy the trades of expert traders to benefit from their skills and experience.
Other than that, you can also opt for future automated trading with the help of expert support. The most automated trading platform offers support to traders alongside other tools and services.
Who is automated futures trading for?
Are you wondering whether automated trading is the right option for you or not? Here are a few types of traders who find automated trading to be extremely beneficial in their investment journey:
Traders who’ve just started investing in futures
Investing in futures requires you to have the knowledge and experience to speculate on a given asset’s future price. As a beginner, you might not know what factors to consider while doing so, and may find the investments overwhelming. Hence, it’s an effective idea to begin investing in futures through a reliable system or software. You can seek help from expert traders while setting up rules for your investments and then sit back, relax, earn and learn.
Traders who want to diversify their investments
It’s no secret that diversifying your investments allows you to reduce the risk of loss while increasing potential profit. However, it demands time and focus – you need to follow up on all your investments and track multiple markets. This can be a struggle for investors, which is why automated trading is a great option to go with. You can simply automate your trades in multiple markets and do a single follow up once in a while to ensure all is going well—no need to sit in front of your computer 24/7.
Traders who lack time
There are many investors out there who have the knowledge and expertise required to spot trading opportunities, though they don’t have the time and energy to do so. Once again, they can benefit from an automated trading system and enjoy fruitful trading results without having to invest much time.
Pros of automated futures trading
In case you’re confused as to whether or not you should opt for automated futures trading, here are a few of the benefits it offers:
With the help of auto trading software, you can largely minimise the time required to identify, enter, exit, and manage your trades. The system will run the show for you while you sit back, relax, and enjoy the profits.
If you’re not experienced in futures trading but want to build a portfolio and make profits, you can automate copy-trading on your futures account. This way, you’ll automatically trade like a pro with zero effort required.
For those who want to diversify their trades but fear that they won’t be able to manage so many diverse investments at once, automating your trades comes to the rescue once again.
So, to sum up, automating your futures trades helps you invest like a pro even if you’re a beginner in the market. It also allows you to save a great deal of time, and it makes it easier for you to diversify your trades without having to worry about the final outcome.
Cons of automated futures trading
While there are several pros of automating your trades, there are also a few drawbacks to it. For instance:
Automating your trades means putting your investments in the hands of a computerised system. If your preset rules aren’t good enough, you can end up in loss.
Sometimes automated trading systems can make you overly dependent on them. You don’t develop the skills and expertise required in order to manage your trades on your own profitably.
Guide to finding the best automated futures trading system
The most crucial part of auto trading is finding the best automated trading software. Here are a number of tips that can help you in your search:
Don’t underestimate the power of research
Online reviews and declarations are highly effective in determining whether a trading software is worth signing up for or not. Make sure you look up the top automated futures trading software on Google and check online reviews for whichever ones you’re interested in.
Find a trader that offers the markets you’re interested in
While some futures trading software would support several markets, others might support a few. It’s important to ensure that the trading system you sign up with offers services in the markets that you’re interested in.
Make sure the auto trading platform offers trading support
Starting out on a new trading system can be overwhelming, which is why you should look for systems that offer trading support. If there’s anything you feel stuck with, you can simply get in touch with the expert trader available on the platform.
Make sure you double-check the costs of the trading platform
Check whether the automated trading system is free or has a charge, then, based on that, make sure that you sign up with a system that you can afford. Many brokers offer automated trading as an additional service on their platforms.
Get AtoZ Markets Premium Trading Signals
1. Choose your AtoZ Markets Premium plan
2. Learn how to use the signals from our guide
3. Open a trading account with a reliable broker
4. Copy the daily trading signals
Sign Up Now!
How to avoid automated trading scams
It’s not uncommon for traders to stumble across automated trading scams online, especially since the market is flooded with auto-trading software. An effective way of avoiding online scams is to read online reviews of any auto-trading systems you’re interested in.
After that, give it a trial run without risking too much of your funds – just to make sure the software is secure, easy to use, and works effectively. Lastly, make sure that you choose one of the topmost auto-trading softwares rather than a less famous one that makes huge claims without proof of those claims.
One of the best auto-trading service providers is AtoZ Markets. They offer the best Forex trading signals and allow forex traders to benefit from their auto-trading service alongside. Suppose you’re interested in the FX market and want to access reliable forex auto trading software. In that case, you can sign up with them and benefit from their highly accurate signals and user-friendly automated trading software.
Our final thoughts on automated futures trading
Trading futures can be an exciting and profitable form of investment, though it’s not as easy as it seems. In order to enter successful futures contracts, you have to speculate on assets future prices by carrying out technical and financial analysis of the market. You also have to remain up to date with ongoing news and market trends.
Automated trading systems make the whole futures investment process a whole lot easier by offering automatic trade management based on preset rules and strategies. You can find a wide range of automated futures trading software online and choose whichever one suits your investment priorities the best.
If you’re interested in automating your forex investments, you can sign up with AtoZ Markets, which is primarily a forex signal provider. They have a good online reputation and offer auto-generated forex signals with a win rate of over 70%. This speaks volumes for their auto-trading services as well.
Automated Futures Trading – FAQ
😏 Is automated trading beneficial for beginners?
Automated trading uses algorithms to automatically enter and exit trading positions based on a few preset rules. All an investor has to do is enter an auto-trading software and input a few rules, such as the trading strategy they prefer alongside the amount they are willing to invest. Then, based on those preset rules, the system will monitor the market and place trades as soon as a relevant opportunity arises. If you want to further simplify your investments, you can simply automate copy-trading on your investment account. Visit our website to learn more about auto-trading and copy-trading.
❓ Is futures trading a high-risk activity?
Imagine you’re running a business, and you need to buy 100 bars of gold in 3 months. However, when you analyse the market carefully, you speculate that the price of gold will increase in the next three months. To avoid the risk of paying higher costs, you enter a contract with the gold seller to purchase 100 bars of gold on a preset date and a predetermined price. You could either end up in profit based on your speculation, or gold’s price could fall, and you could end up in loss. This is futures trading. Visit our website to learn about futures trading and how you can trade futures with the help of trading signals.
✅ Are futures trading signals reliable?
You can trade futures with the help of quality signals as well. Trading signals are basically trading suggestions or indications discovered and sent by market experts. Sometimes these signals can also be auto generated based on an algorithm. Then, you can choose whether to follow the signal or not. If the signal provider has a high win rate, you can end up building a great trading portfolio. However, there are several scammers that offer fake trading signals as well, so it’s important to be cautious when signing up for signals.
