Robots and signals can each take trade decisions completely out of your hands and place them in the hands of a computer program. Signals actually do require some action on your part, as they are delivered to you and then you will need to enter into trades based upon the recommendations. Trading robots can actually trade for you, which would be a wonderful thing or an awful disaster. Should you rely upon these programs to make investment decisions for you?
Trade Signals and Alerts
Binary options signals tend to be used for one of two reasons. Often they are used by new traders who have yet to learn how to trade well, yet they hope that signals will deliver fast and easy profits while they learn. Signals are also used by individuals who have learned how to trade, but are looking for a way to boost profits. Can signals help with these two needs? They could, if (and only if) they are highly accurate. The problem is that there are never any guarantees that the signals you pay for will deliver the results you want.
Robots are a different matter entirely. These come in the form of software that you would need to download and install. After the setup, the robot would trade binary options for you. Robots are not compatible with all platforms, but they still are worth some discussion as some signal and robot offerings are linked together. Even the best robots and auto-traders will never be able to take the place of human trading. The best ones may handle technical data well, but a computer simply cannot account for human emotion. At the fundamental level, sentiment is what drives asset prices and computers cannot judge emotion.
Testing Signals and Robots
It may be possible to put such systems to the test prior to spending any money. The best case scenario would be to take advantage of a free trial offer and then test the suggested trades while using a free demo account. Many brokers now offer these free of charge, but they are rarely advertised which means that you may need to contact customer service to request a practice account. Note that some brokers do request an upfront deposit before providing these account, but there should be no obligation to ever trade with real money within the platform should you choose not to.
The decision of whether or not to use such aides is of course up to you. Just know this – no computer program is going to be able to replace the need for some human involvement when trading binary options. You must learn how to trade for yourself, and will need to learn to trade well if you’re going to generate substantial profits. Keep this in mind when weighing the pros and cons of signals, robots, and auto-trading programs.