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Automatic trading bots have become popular in the cryptocurrency market. Bots have proved to solve the problem of time and speed that majorly affects human traders.
These bots can be programmed to perform the task of buying and selling crypto coins just like a human trader can do. However, the bots are not limited by working hours and the speed of analyzing the market and placing orders (either sell or buy).
As a result, bots have found favor among most traders. Even though all bots have almost a similar main goal, they are not the same. Different boats have different features that make some better than others. HodlBot is one of the most popular crypto trading bots in the market.
HoldBot is a customizable cryptocurrency trading bot that enables the traders to automatically diversify and rebalance their cryptocurrency portfolio.
HodlBot enables users to index the market and create custom portfolios. Unlike most crypto trading bots that focus on technical trading and signals, HodlBot specializes in indexing and rebalancing.
Holdlbot works by plugging into the trader's exchange account and uses the API to execute trade orders. HodlBot features include the following:
Indexing is a passive, low-cost investing style in which you diversify your portfolio to mirror what is in the market. Typically, this involves weighting your portfolio according to the market capitalization of the top coins. Indices aim to capture the average return of the market.
An index is hard to beat. Nearly all active traders fail to beat indices in the long run. HodlBot enables traders to index the market with one of their pre-made indices. The indices are HODL10, HODL20, and HODL30. A user can also create their own indices in case they are not satisfied with pre-made indices.
Hodlbot has accurate and detailed historical data. Once you have chosen a pre-made index or finished creating your own index, you can backtest the strategy to test its effectiveness.
This process involves running the strategy on the previous market condition to see how it would have fared in such a condition. If it is successful in the previous market condition, then there is a high probability that it is a good strategy to employ in the present market condition.
HodlBot enables users to realign the weighting of their portfolio assets. HodlBot rebalances the user’s portfolio after a specified time period. Rebalances keep the user’s portfolio on track.
The user can customize their rebalancing period. This strategy safeguards the investor from being overly exposed to undesirable risks. When the market shifts, a portfolio will drift from its target allocation.
HodlBot automatically rebalances your portfolio to keep it on track. This strategy saves you time and ensures that the risk involved remains within your desired level. This strategy leads to risk mitigation and improved returns.
Other features offered by this bot include a portfolio tracker and supporting dollar-cost averaging.
HodlBot comes with a simple user-interface (UI). The process of signing up is also shot and simple. It is also simple to connect to the supported exchanges through related APIs. Developers built the platform with portfolio management in mind; this is evident in its web-based interface.
Most of the important factors are displayed on the home screen as a dashboard. Therefore, users can have an accurate idea of their portfolio status by just glancing at the screen. Apart from the intuitive UI, the overall functionalities also remain quite simple to set up and execute. This feature is helpful for new traders who are focusing on portfolio management.
HodlBot follows industry-standard security practices. For example, it utilizes a secured web server configuration for its platform in the form of HTTPS. This security feature provides the platform with backed encryption and protects API keys from unauthorized access.
HodlBot also advises its users not to allow withdrawals through their API keys. This strategy ensures that in case a hacker has taken control of the account, they cannot withdraw the user’s funds. The bot also uses two-factor authentication (2FA). This adds another layer of security meaning better security.