| HFT bots (high-frequency trading - high-frequency trading) make a huge number of transactions with minimal profitability, constantly increasing your deposit. And there are two news - good and bad. Let's start with the good!
Good: Over 80% of scalping trades are profitable, which makes technical risk less dangerous for these bots. They will quickly recover possible losses, making them less painful for your budget.
The bad: There are several more significant risks for these bots:
Incorrect position size
First of all, a scalping bot is a powerful machine, but only if you know how to use it. Often traders, driven by greed, increase positions, eventually making them too big for the bot. As a result, the bot becomes absolutely ineffective (unfortunately, this is one of the most common mistakes of many traders). We will talk more about ways to manage this risk in our future articles.
Faster opponents
In addition, since scalping is a high-speed race of traders, your bot is extremely vulnerable to faster competitors (which, for example, use a better access channel to the exchange (connection)). As soon as you are overtaken, any ingenious strategy loses its effectiveness due to the speed of the competitor. And, alas, you lose again. |
Scalping bots / HFT bots
General Discussion -> Transcripts & Audio 2017 & 2018
