The foreign exchange market is a global financial market for exchanging currencies, which largely relies on automated Forex investments. It assists internal trade and investment by allowing businesses to convert one currency to another. It allows companies to shop outside the national borders in which they operate and make purchases using the local currency. The market is unique in that it operates 24/7 except for weekends, in that it trades in the world’s largest asset class, and in that it is geographically unlimited.
The F.D.I.C. once issued warnings to financial institutions doing business in some countries citing volatility as one of the major considerations when considering developing commercial interests outside of the big seven countries. Cultural practices as well as political ones make doing business in some countries issues that have to be considered in mitigating risk. In some countries assets can be seized by the government at any whim of a government leader without justification or provocation. Not only that, the government can and sometimes does take actions to manipulate the value of its currency, to falsely strengthen its position, especially if it is a less-capitalistic economy.
Speaking of foreign countries, the primary concern in considering Automated Forex investments and trading is the stability of the political environment followed by the economic. In human trading, the human is aware of political or economic changes in a given currency or national situation. In the song of praise for auto trading, especially foreign trading and investing, the ease and alleged more efficient trading that results in more profitable trading are key features. But what is the blessing may also be the curse.
It seems, though, that risk itself is the greatest risk in automated foreign market trading. If banks around the world are concerned about white cloud banking vulnerability to compromise, theft, security breaches, even Advanced Persistent Threat, then a red flag certainly is raised in considering using software to do trading and trading with automated Forex Investments.
True it is that robots and computers have proven as invaluable to man’s life and work as the Seeing Eye dog is to the independence of the blind. The very characteristic that is the strength is also the weakness. Years ago auto makers boasted automated assembly plants but the quality of American made automobiles did not improve, only the number of automobiles the robots were able to produce.
There is no question computers generally will accomplish the task faster, more efficiently, and at a lower error rate while making automated forex investments, but computers do only what they have been programmed to do. They do not take abstract facts into consideration like gut feelings or hunches. A human can take recently announced developments and make last-minute decisions to act or not act. Automated forex investments means the indicators have to be reprogrammed in order for the auto trading software to respond to real time input. By then, it is not real time anymore.
For example, if a leader of one of the former eastern bloc countries decides to have all the government employees buy their own currency to make the market look like it is gaining strength to attract investors or traders, the automated trading software is not programmed to recognize what might be obvious to a politically savvy human trader.
Automated forex investments may be worth considering yet at considerable cost. Is a $400 dollar an hour gain worth the possibility that the program might be hacked and instructed to transact in ways not intended by the licensed trader.