Automated Stock-Trading Platforms to Know in 2024

Robot stock-trading platforms are now responsible for up to 78% of all trades in today's stock market—and as much as 90% of short-term and crypto-market trades. 

As most investors know, the “big boys” and “smart money” on Wall Street have been using automated quant methods for years, generating alpha through preset programs and high-frequency trading. But now, everyday investors and traders are also getting in on the act. 

So, what’s behind this growing popularity? And how are ubiquitous robot stock-trading platforms reshaping the market? 

Robot stock-trading platforms work fast, using software and technical analysis to execute trades in milliseconds, which can help improve traders’ returns. With approximately 4 million trades made daily on the New York Stock Exchange and close to 5 million on the Nasdaq Stock Exchange, the impact of robot stock-trading platforms on market movement is significant—bringing increased speed, volume, and competition.

In this guide, we'll explain robot stock-trading platforms, the benefits of using them, the different types available, and how to choose the right one for you. We’ll also explore some of the leading robot stock-trading platforms and trading apps on the market today.

The ultimate guide to robot stock-trading platforms

In recent years, dozens of robot stock-trading platforms have launched, each promising to revolutionize how investors engage with the market. Consider Pionex, Tradingview, Metatrader, MT4, MQL4, MT5, Trendspider, Trality, Coinrule, eToro, Avatrade, Autopilot, and Quantconnect, to name a few. And that's not to mention the robust features many more traditional brokerages may offer, from Etrade to Interactive Brokers.

However, not all automated trading platforms are created equal, and investors seeking to optimize their trading need to tread carefully. 

As a general guideline, investors should prioritize platforms that align with their trading preferences, risk tolerance, and financial objectives. Factors such as ease of use, customization options, and integration with advanced technologies like artificial intelligence are essential to consider. You'll also want to carefully scrutinize each platform's security measures, transaction fees, and customer service. 

In short, a platform that offers low-cost, easy trades and excellent functionality is key, but keeping an eye on reliability and security simultaneously is equally vital.

What is a robot stock-trading platform?

A robot stock-trading platform is a computer program that uses technical analysis to identify and execute buying and selling stocks. These platforms provide investors a data-driven and disciplined approach based on functionalities like automated trading, historical data analysis, and backtesting (evaluation of algorithms across different time frames).

Investors can apply targeted investment strategies to uncover profitable trades and improve performance. Robot stock-trading platforms can also provide insights into market trends that humans might miss.

By setting specific money-management rules into automated-trading systems, traders can eliminate emotions from their approach and become more objective in their trading decisions, while autotrading can force traders to be more methodical and place trades based on certain predetermined criteria only. 

(Ready to discover how Composer can elevate your trading experience and help you make successful automated trades? Sign up for a 14-day trial today.)

Benefits of using a robot stock-trading platform

Robot stock-trading platforms are highly efficient because they analyze market data and automate trade execution faster than a human trader, helping you take advantage of split-second opportunities.

Other key benefits include:

Tight control

Robotic trading provides tight controls over parameters. This allows traders to set parameters for how, when, and under what circumstances trades will occur. The presence of objective decision-making criteria can be helpful during volatile market conditions.

Risk management

Besides removing errors and emotions from trades, users can also improve risk-management practices based on individual tolerances. For example, traders can automate practices such as stop-loss orders or trailing stops to limit potential losses. This can be especially important in a volatile market and for swing traders to enable risk controls and hedge against risk in investing.

Scalability

Bot trading can handle a significant volume of trades simultaneously and scale trading operations to nearly any size trading strategy or style. That allows traders to keep growing their portfolios in a more efficient, scalable way.

24/7 coverage

Thanks to automated trading strategies, trading bots can handle trading sessions anytime, allowing traders to leverage market opportunities regardless of when they occur.  

Backtesting

Many bots enable rigorous backtesting strategies by applying models against historical market data to forecast success and potential trades. A robust backtesting engine can help measure model reliability.

Diversification

Users can trade multiple accounts or apply different investment strategies simultaneously. This diversification can spread risks and create a hedge against losing positions. 

Types of robot stock-trading platforms

Stock-trading bots are available in several forms. Here are three of the most common and how they are used in investment strategy.

1. Technical indicator-based bots

Technical indicator-based bots use analytics to analyze moving averages to identify price trends and patterns. Rather than relying only on economic data, annual reports, price-earnings ratios or other fundamental evaluation metrics, a technical indicator bot forecasts future trends based on stock price movement. Traders may use one or more indicators to establish entry, exit and trade management configurations.

2. Experienced traders-based bots

Also known as copy-trading bots, experienced trader-based bots follow successful traders (such as Warren Buffett or Cathie Wood) and copy the trades they make in the stock and financial markets. While experienced traders can set parameters for trades they want to make, this type of bot is generally used by beginner traders who may need more experience or confidence to make their own decisions.

3. Algorithmic-based robot stock-trading platforms

Algorithmic-based trading bots can execute trades rapidly and efficiently, reducing or eliminating manual errors or mistakes human traders make. Trading algorithm strategies employ a rules-based approach to align with your trading philosophies, eliminating out-of-scope trades or emotions. Providing a systematic and logic-based approach to trading rules ensures every trade fits your investment philosophy.

Key considerations when choosing a robot stock-trading platform

When considering a stock-trading bot, there are several key factors you want to keep in mind, including your own programming skills, range of assets, and desired performance.

Programming skills and programming language requirements

Some bots require advanced programming skills to set up and customize, so you must ensure you have the skill level needed to optimize bot performance and some experience creating algorithms. What's more, if programming is involved, you must also understand what underlying programming languages are required; Python, C++, Java, and R are among the most common. 

Not a programmer or well-versed in coding? Not a problem. Conveniently, some platforms, such as Composer, feature no-code programming or deploy intuitive controls.

Range of assets

Different bots may work better depending on your specific strategy and style, so choose a bot that handles the range of asset classes you want to trade, such as stocks, foreign exchange (forex) markets, or crypto. Popular platforms include MetaTrader or TradingView for forex traders, AvaTrade for CFDs traders, Trendspider for stock and algo traders, and Pionex, Trality, and Coinrule for crypto traders. 

Profitability of trades (Backtesting approach)

Remember, past performance does not guarantee future performance; the same goes for trading algorithms. Still, you should evaluate a bot’s track record of success. Bots with backtesting capabilities can provide trading insights into historical performance and potential profitability.

Popular robot stock-trading platforms for 2024

Composer

Composer is a no-code algorithmic trading solution that does not require advanced programming knowledge. Composer's smart algorithms let you test before you invest and excel at capturing upside with downside protection. 

By constantly monitoring your portfolio, Composer’s powerful and user-friendly tools help hedge risk during volatile markets and can also automatically rebalance your portfolio. 

Composer allows for highly customizable parameters to fit your specific algorithmic trading strategy, and the backtesting functionality enables optimization before implementing your plan in live trading.

StockHero

StockHero lets you test your strategy in a simulated paper trading exchange before you deploy it in the real world. This no-code bot also enables you to leverage experienced traders by mirroring performance.

StockHero lets you create, test, and deploy stock-trading bots in minutes, allowing traders to leverage long and short strategies, dollar-cost averaging, range-bound trading, indicators, and triggers.

Trade Ideas

Trade Ideas also enables simulated trading with different performance levels for beginning and experienced traders, allowing for complete customization of parameters and trading strategies in U.S. and Canadian markets.

Trade Ideas features "stock racing," or its visual perspective on scanning the market to create real time watch lists, see the most active stocks, and stay focused on repeat winners.

EquBot AI Watson

EquBot uses IBM Watson’s artificial intelligence (AI) to make trading decisions, including news articles and social media analysis. It also enables machine learning so the platform understands your trading preferences over time, reducing the time it takes to customize and refine parameters.

EquBot allows you to customize portfolios globally with its portfolio as a service (PaaS), including customizing across asset classics, environmental, social and governance (ESG) mandates, and thematics.

Tickeron

Tickeron, a subsidiary of SAS Global Corp, offers customizable bots and provides dynamic price alerts for trade timing that involves stock, exchange-traded fund (ETF), forex, and crypto pattern recognition. Among other benefits, Tickeron’s pattern recognition surfaces daily top-ranked stock price patterns and provides a confidence level for trading ideas.

Tickeron’s AI also lets you view bought and sold trades with potential profit and stop loss in real time. The platform likewise offers robust trend-forecasting tools, using historical price data to predict future trends along with a confidence level.

TrendSpider

TrendSpider is a favorite of many day traders who want to spend time analyzing key indicators as well as detailed and technical stock charts. Dynamic trade alerts and automated trading bots help investors time the market and eliminate manual, time-consuming charting and scanning. For these reasons, Trendspider caters to experienced and high-volume traders but may be challenging for novice or beginner traders.

Algoriz

Algoriz enables the automation of trading in equities and cryptocurrencies, connecting directly to various data vendors. It supports Bitcoin, Ethereum, XRP, and other currencies.

It also features a simulated matching engine to test algorithms before deployment and supports more than 10,000 trading plans.

Scanz

Scanz is an all-in-one stock-trading tool to accommodate day traders and swing traders, sending a continuous stream of trade opportunities in real time. Users can scan and sort trades manually or choose pre-built scans.

Scanz can also be pre-configured based on more than 100 parameters and technical variables, leveraging more than 100 new sources, wire services, financial blogs, and Securities and Exchange Commission filings.

Enhancing opportunities for success with automated stock-trading platforms

Automated bots and robot stock-trading platforms can streamline your trading, reduce errors, and help eliminate emotion from your decision-making. However, the decisions you make along the way, the parameters you set, and the platform that you choose will determine your overall success. While there are many aspects you can set and forget, as the market evolves, you'll need to do maintenance and tweak algorithms to take advantage of market conditions. Ultimately, which robot stock-trading platform you choose must fit your trading philosophy and level of comfort with technology. 

Ready to get to it? Start your automated bot trading journey with Composer by signing up for a free 14-day trial now.