Now that all the doubts about the stock trading robot have dissipated; its time to analyze how the daily trading robot really works which is basically asking: how does it make money? Roughly, this is a question also linked to: why does it make money? Or why is it effective at making money?
In order to answer these questions, we have to ask: Where the daily stock trading robot does gets its money? The stock trading robot is specifically designed to trade in the penny stock market. For beginners, the penny stock market is the market exchange for companies whose stock is price 5 $ and below regardless of how much capital they have.
These stocks’ prices are highly volatile, and can allow the investor to earn a few hundred percent in a few days assuming of course that they invested on the correct stock option in the right time and sold them in the right price.
The difficulty with the penny stock market is, of course, how to predict it. Most of the companies listed on the penny stock market, being small (many have market capitalization of below 5 million), are at the mercy of financial market trends. Here is where the day trading robot comes in. It scans penny stocks looking for market indicators that can tell which stocks may go up.
It identifies profitable stocks by comparing the market indicators with set patterns in its database and once it is sure that it has found a stock that is about to go hot, it makes a recommendation and all you need to do is decide how much you wish to invest. Monitor the same investment next morning and see that the stocks that you bought yesterday have risen in value. Of course, you sell the investment and reap the profit.
There area a few advantages already evident here.
One is the stock trading robot does its analyzing for you. More effective in scanning and crunching numbers than a human analyst, it alerts you for opportunities once it recognizes them. Plus, since it scans not just a limited number of stocks as human can, it effectively runs through the whole list of possible stock option candidates. And with thousands of stock portfolios in the penny stock market, it is totally impossible for you not to find one that will reap profit.
Secondly, the stock robot is free from human emotion; it will neither cower out of a bull or be overbearing which is the most common weakness of human traders. Remember, the best trader is the one who sees the numbers as they are – just numbers. Thirdly, the stock trading robot can churn out its recommendation in the first 15 minutes it is running. Hence, you don’t really take the entire day analyzing the market.
This gives you 2 immediate advantages; you can invest almost as immediately as the stocks go hot – You get a first shot at the bandwagon. And secondly, you can stop trading almost a few minutes after you start – which frees you for other activities. You can even get another job that will require you to go in only on the rest of the day assuming you can find one.
In the end, we earn money only for other purposes. If you can earn enough money in the beginning of the day using this tool, then give time for things more important, then buying a day trading robot will be worth all the money spent.