BOTS Blog: The difference between trading with a high-risk bot and a low-risk bot
BOTS is going to turn the world of investing upside down. Algorithmic trading will become available to everyone in the world, not just the richest 3% in the world. To help you get started with the BOTS app, we've created some informative videos for you.
The BOTS app is an open platform on which expert developers offer their bots. These bots invest for you. They make their choices based on artificial intelligence, machine learning and algorithms. So bots are actually automated trading strategies.
With our app, the best trading strategies are now available to you. And not only for the richest 3% of the world. In this way, together we will turn the world of investing upside down and make it fairer and more transparent.
Acting with a bone
Trading with the BOTS app can be done in different ways. You can choose a bot that takes a lot of risk or you can choose a bot with a lower risk level.
In this video Simon explains the difference between the two and how you can make the best choice.
Trading by algorithm
BOTS uses algorithms to trade in different types of crypto currencies. These algorithms are developed by experienced traders and professional developers. The goal of such an algorithm is simple: to make as much profit as possible for the user.
In short, you can say that a bot that takes a lot of risk will also have higher returns, but of course also higher losses. In a bot with a low risk level, the peaks (and valleys) are much less sharp.
The BOTS expert has his say
To find out more about the difference between high and low risk bots, Simon called Arthur, the head of the bot creator team and asked him what is wisdom now for a beginner like himself.
"If you're really completely new to the world of trading and investing, then it makes sense to start with a bot with a low risk level and build up from there. That way you can get a feel for this way of trading or investing rather than diving straight into a high risk bot."
The bots in the BOTS app not only have different risk levels, they also trade with different base assets. "A base asset is your safe haven," Arthur says about this. "For example, you can choose a bot with a base in Bitcoin but also a bot with a base in the US dollar. The base asset is the currency the bot returns to when it's not trading. A bot with the dollar as its base asset is therefore less risky than a bot that has Bitcoin as its base asset."
Simon also wants to know whether Arthur, with a deposit of €150, can become a millionaire before the end of the year. Arthur laughs at this. "No, but nobody can."
In general, younger traders seem more willing to take risks. The reason for this is that they want to earn a lot of money quickly. In addition to this they often have less money to deposit than older and more experienced traders. The people who have more money to trade with are generally a bit older and are much less willing to take risks.
According to Arthur, taking more risk at a young age is not a problem at all. The older you get, the less risk you should take. In this way you avoid, when you retire, that your entire investment evaporates because you took (unnecessarily) high risks.
Simon considers himself still a "young" person and therefore might be able to take more risks now. He daydreams a little further about the price of Bitcoin. "Suppose I had bought Bitcoin for €4000 in 2012, it would have been worth €9333 now."
Still, Simon feels more comfortable with low-risk bots, so he's done his own personal research on that.
Because of his desire to not take too much risk, Simon compared a number of apps and ultimately decided to start with the BOTS app.
The BOTS app allows him to trade with bots that are low risk in order to focus on the long term. Why that's so important, you can read here.
Investing is for everyone
Everyone should be able to invest. And now they can. With BOTS. Are you interested, but your question hasn't been answered yet? Take a look at the FAQ's on our site. Or contact us, we will gladly explain it to you in person.
Need any help with anything?
If you still have questions about the BOTS app, do not hesitate to contact our support department.
The BOTS app is now live
There is no such thing as risk-free trading. It is possible to lose (part of) your stake.