By Rohit Nagar
Publish date: 17 JAN 2024
AI processes diverse data sources to identify patterns and inform trading decisions, potentially outperforming human analysis.
AI removes the emotional rollercoaster of trading, avoiding impulsive decisions based on fear or greed and sticking to the trading strategy.
AI bots can tirelessly monitor markets around the clock, capitalizing on fleeting opportunities while humans sleep or take breaks.
AI can efficiently test and refine trading strategies on historical data, identifying the most effective approach for future market conditions.
AI provides different algorithms for trading styles like trend following, mean reversion, and arbitrage, allowing traders to choose based on their preferences and goals.
Some AI models lack transparency, making it difficult to understand their reasoning behind trade decisions, which can raise concerns for risk management and regulatory compliance.
The accuracy and completeness of the data used to train AI models is crucial for their effectiveness. Biased or incomplete data can lead to flawed trading decisions.
AI trading is rapidly evolving, and regulatory frameworks are still catching up. Staying informed about these developments is essential for responsible trading practices.