Why More UAE Investors Are Using AI Trading Bots In The Stock Market

Trading in the stock market can be a tedious and time-consuming activity, which is my many investors are turning to artificial intelligence (AI) trading bots to keep up.

These bots, built to execute trades in milliseconds, are growing in popularity for their ability to analyse massive volumes of market data in real time. According to a stockbroker, they can scan a wide range of financial markets - including stocks, commodities, bonds, indices, forex, and cryptocurrencies - with remarkable speed and precision.

However, while AI may offer speed and efficiency, not everyone is convinced. Critics argue that the outcomes are still largely speculative. The Commodity Futures Trading Commission, a United States agency which regulates its derivatives markets, issued a warning last year.“Don't believe the scammers. AI technolog can't predict the future or sudden market changes,” it said in a statement in January 2024.

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Despite the scepticism, the AI trading bot industry is booming. According to Precedence Research, the global AI trading platform market is expected to increase from $13.52 billion (Dh49 billion) by 2025 to around $69.95 billion (Dh256 billion) by 2034.

According to Rami Altabesh, senior account manager at Equiti, there's been a noticeable uptick in AI trading bots usage in the markets.“Not all of them are effective," he said. "It really depends on the algorithm they use and the servers they run on.” Still, he acknowledged the trend isn't slowing anytime soon, and that AI will only become "even more useful in the future of trading".

One company at the forefront is Matrix AI, a UAE-based fintech (financial technology) platform that develops AI-powered tools for stock and forex trading. Its signature product is a daily forecast bot, which is essentially an AI system that sends daily predictions across various financial instruments, including stocks, indices, and currency pairs.

Muhannad Alteneiji, the founder of Matrix AI, said he built the platform to counteract emotional decision-making in trading.“I've seen firsthand how emotions, [like] fear and greed, impact human traders,” he told Khaleej Times.“I wanted a system that could bypass those emotions and stay objective. AI gave me that: it doesn't get tired, it doesn't panic, and it doesn't second-guess decisions.”

While Alteneiji sees AI as“superior” in many technical aspects, he doesn't believe it should completely replace human insight - especially in unpredictable markets.“The best approach is hybrid; let AI do the heavy lifting, and let humans provide context." The heavy lifting he is referring to is analysing large data sets quickly and executing disciplined trades.

According to him, some Matrix AI strategies have outperformed traditional manual trading by as much as "10 per cent to 20 per cent annually", emphasising that the best results come from combining both AI and human elements.

Concerns have also been raised about whether AI tools give certain traders an unfair edge. Altabesh disagreed.“It's not fair to say that AI gives an unfair advantage. These tools are available to everyone; they're just new options that traders can choose to use.”

Just as the Internet was once deemed“revolutionary” in the context of the stock market, AI is no different.“Whether or not AI gives users an unfair edge or is simply another tool in the modern toolbox is ultimately up to usage and access,” said Vijay Valecha, chief investment officer of Century Financial.

“AI trading bots are potent tools that deliver performance, efficiency, and scalability,” he said.“But their value hinges on clean data, strong governance, and intelligent design. Used properly, they enhance decision-making, not replace it.”

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