There are a few types of autotrading methods investors can use to buy and sell stocks. Before comparing variations of automated trading software, it’s important to define the distinct camps of autotrading.
While robo-advisors are backed by real people who monitor and use preset algorithms to automatically make buy and sell decisions, an artificial intelligence (AI) automated trading system is fed data that helps it determine the best time to execute trades on its own. Trading bots fall somewhere in between, as they perform automated trading based on pre-determined rules.
Robo-advisors refrain from using AI and are more friendly for those learning how to invest. In contrast, only experienced traders can properly inform AI trade automation and bots.
“Auto trading bots are a small part of the market,” says David O’Leary, CFA charterholder and WealthRocket’s personal finance expert. “It’s still so new that aside from die-hard day traders, it’s a small group of people using them. Trying to trade off of market patterns is largely a dangerous exercise and can easily go wrong.”
But, the prospect of AI and bot trading remains alluring to some. In this article, we’ll show you how some of the most popular automated trading platforms compare.
Interactive Brokers (IBKR)
- Account Fees Tiered pricing based on volume, fixed pricing per share or as a percentage of trade value
- Minimum Deposit $0
- Asset Types Global stocks, Options, Mutual funds, Hedge funds, Futures, Bonds, Gold, Currencies, Forex, Cryptocurrencies
- Trade Fees $0
Interactive Brokers (IBKR) is a low-cost online broker that allows investors to automatically trade stocks, options, futures, currencies, and more across global markets. The broker is a staple in Canada, regardless of how much you invest.
In addition, IBKR offers a highly customizable API, connecting you with an automated trading system. Although it caters to sophisticated users and can require high competency in writing code, it can still be used by everyday traders.
Compare AI autotrading apps
While each AI investing app shares the common element of automation, they differ significantly across integrations, asset classes, levels of coding complexity, and other dimensions. Automated trading systems use complex strategies that aren’t recommended if you’re just starting to invest.
By means of data processing, AI can perform tasks and act like a human, allowing it to trade and alert you of potential trades. It isn’t constrained by a set of rules unless instructed otherwise and will continue to learn based on automated trading results.
Here are some of the top automated trading apps that may help inform your investing goals.
Capitalise.ai is a code-free trade automation platform allowing traders to create, backtest (testing a strategy’s historical performance), and automate trading strategies easily. Traders can write in plain English and AI will establish a trade. Some of their notable bots include asset correlation, MACD cross, and trading the news. The automated trading system currently supports Interactive Brokers and is free for IBKR clients.
Tickeron provides a marketplace of pre-built AI trading bots for auto trading stocks, ETFs, crypto, and forex. Investors can backtest bots, run them in virtual simulation mode, and get real-time trade alerts without writing any code. While the platform only offers paper trading, they expect to provide brokerage integration soon. The automated trading system cost begins with free entry-level membership, with expert plans reaching up to $250 USD per month.
StockHero provides AI-powered automated trading for CFDs, forex, and crypto. While no supported brokerages exist in Canada, you can still access key features such as backtesting, paper trading, mobile apps, and risk management tools. Plans range from $4.99 USD monthly for one active bot to $99.99 monthly for 30 active bots and more advanced features.
MetaTrader 4 is one of the most widely used multi-asset trading platforms. However, you’ll need to become proficient in their MQL4 programming language to automate trades and develop AI integrations on your own. Those adept in the platform benefit from diverse asset classes, ranging from forex, stocks, and futures. While the platform is free for traders, you’ll need a separate brokerage account to execute trades. The price you pay for live trades varies with your brokerage account.
Trading bot alternatives
Unlike AI-based platforms, trading bots perform autotrading based on pre-defined rules. Below are some popular trading bots.
NinjaTrader provides a platform for active traders focusing on futures and forex. The platform requires an understanding of their proprietary NinjaScript language to automate trades. Monthly plans range from free to $99 USD. They also offer a lifetime membership of $1,499 that provides access to the lowest commissions.
HaasOnline provides traders an advanced platform to create, test, and deploy automated cryptocurrency trading bots. The automated trading platform enables users to build trading algorithms visually through a drag-and-drop editor and via coding using HaasScript, their proprietary scripting language. Be especially careful with cryptocurrency investments, as they don’t receive CIPF coverage. Plans range from $9.00 to $149.00 USD per month, with annual plans offering a discount.
Build Alpha helps professional traders easily create, test, and optimize automated trading strategies without coding. The platform uses a drag-and-drop interface to research and backtest trading systems against historical data. They can then generate code to automate the strategies across platforms like Interactive Brokers and NinjaTrader. Their lifetime licence currently costs $1,500 USD.
Pionex is a cryptocurrency exchange that provides free trading bots. It offers 16 options, including grid, DCA, and rebalancing bots that automatically execute trades. Likewise, the platform is beta-testing PionexGPT, which uses AI to create trading algorithms from written text. The platform charges a 0.05% trading fee.
WunderTrading is a platform for automating crypto trading strategies. It allows users to convert signals into live trades on supported exchanges like Binance and Coinbase. Traders can leverage WunderTrading’s tools to implement automated approaches for day trading, swing trading, arbitrage, DCA, and more to grow their crypto portfolios. Pricing ranges from free to $89.95 USD per month. Occasionally, the platform has sales.
What is an AI automated trading platform?
An AI automated trading platform analyzes historical trends to identify patterns with profit potential. Although a less common Canadian investing habit, the platforms aim to identify a “signal” and automatically enter and exit trades without manual intervention. The primary challenge is the need to innovate new signals constantly.
“If they identify patterns, and everyone catches on, then the pattern loses profitability,” says O’Leary. As such, he questions the long-term profitability of publicly available options.
However, various AI technologies continue to evolve. At the cutting edge, natural language processing (NLP) tools help traders extract insights from financial news and social media data. Likewise, many platforms are implementing AI-based fraud detection and risk management.
Pros and cons of AI autotrading
Minimizes emotions in trading
Browse pre-tested algorithms
Ability to automate entire investing strategies
Rapidly execute trades based on continuous AI learning
Potential for glitches
Unexpected market conditions can interrupt patterns
Trading on historical patterns, which may not happen in future
Frequent stock trading in registered accounts can cause them to lose their tax exemption
Proven alternatives to AI automated trading systems
Considering the expertise required to leverage AI automated trading, many prioritize more passive investment strategies — like robo-advisors. This method allows you to work with a pre-set portfolio of stocks that can be rebalanced as needed.
For example, platforms like Wealthsimple Invest offer a simple buy-and-hold approach to investing.
- Account Fees $0
- Minimum Deposit $1,000
- Asset Types Stocks, Options, Bonds, ETFs, Mutual Funds
- OTC stock fees $0.01 per share, min $4.95, max $9.95; free ETFs, selling costs $0.01 per share
Likewise, portfolio services offered through Questrade provide investment options for any comfort level.