What is an Algorithmic Trader?
For the Algorithmic Trader, trading decisions are made by an automated algorithm that is either coded by the trader themselves or purchased commercially. An array of specifically-calibrated technical analysis tools is usually used in a defined sequence to generate buy or sell signals. This is overlaid with strict risk management conditions. Algorithmic Traders look to minimise the discretionary element in live trading, relying instead on back- and front-testing to fine-tune a strategy’s profitability statistics.
Why did I get this result?
This shouldn’t come as a surprise to you, but you love technology and the vast difference it can make to your life, particularly how it can be used to help you make decisions and improve your chances of winning what might seem to be randomised games of chance.
Your answers suggest that you enjoy technical analysis and have a high level of trust in computers and technology in general. You also seem to rely on technology in most aspects of your life, so it won’t be too much of a stretch for you to rely on it in your forex career as an Algorithmic Trader.
Decisions based on technical research and computing power seem to hold more weight for you than those based on human intuition, and you are attracted to the thought of reducing risk by using technology to form your exit strategies.
Finally, you are a person who is happy to take time learning about your craft, and do not expect immediate small awards – instead using technology to build towards more long term, larger wins.
Which assets may be compatible with this trading style?
Am I destined to be an Algorithmic Trader forever?
As you grow and learn within the world of forex trading, your style and approach to trading will develop as well. The Algorithmic Trader style matches your current affinity for favouring the use of computers and technology to make the right decisions, but in a few years, you might have changed your trading style a little. Take this test again 12 months into your forex trading career and see if you have remained an Algorithmic Trader, or if you’ve become a Scalper, a Swing Trader, a Position Trader or an Event-Driven Trader.
REMEMBER, these results were based on a short personality test. Forex trading in your suggested style will not guarantee success.
What is my next step?
If you’re just starting out in your career of forex trading, then DailyFX.com and our years of experience can help put you on the right path. Now you know what type of trading style suits you, why not start putting your strategy into practice? Open a demo account with IG, the provider of DailyFX, today.
Join one of our regular webinars to get insights into the world of forex trading and learn how to develop your own trading strategy. These sessions are run by experienced traders who will discuss emerging opportunities and the latest proven strategies for budding Algorithmic Traders such as yourself.
You can also download our free e-book, Tips of a Successful Trader, to learn from real forex traders about the common pitfalls and how to avoid them.