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Proprietary Mechanical Trading Systems
The Mechanical Trading Systems have predefined trade entry and exit rules.The trend is evaluated to identify whether entry or exit conditions have been met. A BUY or SELL signal is generated when price levels trigger the technical indicators used to generate exchange signals.
What are Advantages of Mechanical System Trading?
The primary advantage of system trading is that it provides investors with an unemotional, rules based, decision process. The benefit is that a rule based decision making process can be tested against historical data to determine profitability. Subjective approaches cannot be tested, and therefore, cannot be proven or dis proven profitable, as in using newsletters or TV. Another major benefit of a mechanical approach, which uses technical indicators, is that analysis, news, or questionable accounting practices are eliminated.
Human emotion, which is consistently cited as a major contributing factor to poor investment performance, is eliminated. Also, the need to study charts and TV all day to decide what to do before the closing bell is eliminated. Get your life back.
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