Trading robots are understood as software programs for automatic stock trading, which appeared in the US in the 1980s and 1990s. By 2016, automatic transactions in the US accounted for 75% of the trading volume of the entire financial market. The Vietnamese stock market is now over 20 years old, enough time for us to believe that investors have been trading with "Trading Robots".
"Trading Robots" are programmed, connected to information on the market, when each stock code meets all the criteria (according to programming), it will automatically buy or sell. Thus, a certain stock code will be automatically bought at a good price, automatically closed at the expected profit level, and if the price decreases, the loss will be automatically cut...
With such an operating mechanism, a scenario that causes investors to lose money is as follows: when a stock code has a good price, the Robot will automatically buy very quickly (possibly in large quantities in a short time), causing investors to buy and make the stock code increase in price, while investors are busy and have not finished buying, the Robot will automatically sell very quickly when the price reaches the profit level (according to programming), at this time many investors will not be able to sell their "goods" in time because the Robot works much faster.
Are "trading robots" scary?
If we calm down, we will not be afraid of Robots, because simply Robots must be programmed by someone with knowledge of stock investment, and that someone is also human, the programming criteria for Robots are also subjective to humans. In addition to admitting that Robots make transactions very quickly, let's look at its disadvantages:
1. The criteria for identifying a good stock code will change over time, Robots will not be able to update themselves but only operate according to pre-programmed criteria.
2. If a stock code is manipulated, creating fake information on the market... then Robots will not recognize it.
3. Being dependent on codes and energy to operate, Robots can also fail or stop working at important times.
So what should investors do to avoid losing money because of "Trading Robots"?
First of all, let's see that Robot is just a "Trader" who can enter and match orders faster than us, then proactively overcome the shortcomings of Robot to perfect us:
1. Attend shareholder meetings, meet the Board of Directors of the enterprise, if possible, visit the factory, warehouse, office... to feel and understand the real "health" of a certain stock code, instead of just surfing the web, reading online reports. That way, we will have decisions based on our own true feelings, if the stock has potential, we can buy before the Robot buys, if the stock is really good, we are confident to hold it for a long time instead of selling "green rice" like Robot.
2. Don't be lazy (like Robots that only know how to operate according to pre-programmed instructions once), every day, keep learning and updating information to promptly recognize changing trends, factors that determine the value of a stock code at each stage, each economic situation of the country and the world. That way we have the opportunity to recognize virtual values, not being bought by Robots.
3. Don't let money blind you and forget other values of life such as family, friends and especially health. Don't let one day your brain fails or runs out of energy without anyone to help you get it back, at that time even if you have a lot of money, you will lose it, and if you lose it, you can't get it back.
"Trading Robots" are real, losing money, gaining money is also real, all of these things can be actively created by humans.
Gieo Quảng
