Difference between Bracket Orders and Automated Order
There are great differences between a Bracket order and an automated order. The differences are a result of several factors. The factors range from the definition, how they work and the mode of execution.
- Mode of operation of the two orders
A difference is seen between bracket orders and automated orders basing on their mode of operation. Bracket orders are the sort of unique intraday orders just like those found at CoinFLEX. They are intended to provide traders with security. Traders can enter 3 orders concurrently in one click with bracket orders. This is a sophisticated form of intraday order supported by a “take profit order” It enables traders to simplify their businesses through automation. It also significantly assists in the reduction of the risk involved.
The word automated order system, on the other hand, applies to a computerized channel. This channel delivers orders to the specified order return system or to exchange floor brokers. The automated order framework guides the orders of the dealer. This is important in ensuring that they are implemented at a quicker rate.
Automated trading platforms have the pace and precision required while conducting orders. Such systems may reduce the number of mistakes by eliminating human intervention at this step of the order handling cycle. Ultimately, they can also provide a further layer of fraud protection to help regulate risk.
- How to execute Bracket and automated orders
The difference between the bracket and automated orders is seen on how the two orders are executed. Three orders are included in the Bracket Order viz. A limit order, take profit limit order and stop-loss order. If a trader enters a new order for purchasing/selling with the aim/exit price as well as a stop-loss, all three orders are put as a bracket order. The other two orders immediately start when an initial buy/sell limit order is performed.
If anyone of the orders is carried out in the profit limit or stop-loss order, the other order will be canceled. This is because two items are mutually exclusive. These are the target profit order and the stop-loss order. The sequence for bracket order is intraday order.
Automated order execution, on the other hand, uses a mechanism for carrying out transactions without manually inputing them. Automatic systems enable traders to buy or sell an asset by using selling signals. This happens when a trigger is produced so that the trader does not have to manually enter the order. A wide range of technical indicators and processes can eventually be used to produce automated orders.
Professional traders and advertisers and some stock traders often use automated trading techniques. The foreign exchange (forex) market is one exception. In this platform, a large number of retail dealers are provided with automated trade methods and systems.
- Categories of automated and bracket orders
The difference between the bracket and automated orders arises from the major categories of the two systems.
Bracket order categories
This is the limit order used to establish the initial position
Take Profit or target order
This is the order that a trader wants to take advantage of, and take his position and profits.
Stop Loss Order
This is the order used when the market is undesirable and the losses are increasing.
Automated order categories (Forex trading)
Automated forex trading programs are usually classified into two groups. These groups are Expert Advisors or EAs and forex robots.
EAs are generated by extremely qualified and experienced experts. These experts develop formulas for market trends to be analyzed. They also determine the business process to be carried out. They are selected based on their level of expertise and qualifications. This is to ensure that customer traders avoid panic or anxiety.
A Forex robot is identical. It’s a software program for monitoring the exchange and market demand on behalf of traders.
The distinction between these groups is that EAs are not active in trading. Forex robots, on the other hand, are active and prominent. EAs give traders trade signals. It is therefore upon a trader to decide manually whether to open the trade or not. On the contrary, Forex robots can automatically handle the entire trading process.
- The order speed
The difference between bracket orders and automated orders also arises from the order entering speed. The order entering speed for automated orders is faster than that of bracket orders. Automated systems can issue orders as soon as trade criteria are followed. This is because the computer acts immediately at different market stages. A few seconds before you walk in and out of a deal can have a major impact on trading returns. As soon as positions are enrolled, all other positions are instantly shown. This includes protection stop losses and profit targets.