Forex trading means currency exchange trading. Forex trading is done either manually or by using forex robots. The word robot itself implies mechanical involvement. A forex robot is a software program that reads market trends based on settings entered by the trader. A forex robot, also known as FX bots or expert advisors, are computer programs based on market strategies in Metaquotes Language (MQL). They are planned to open and close trade in the market either automatically or semi automatically. The forex robots can either be bought ready-made or configured according to the needs of the client.
MetaTrader is an electronic forex trading platform developed by the Meta Quotes company in the year 2002. It is widely used by the forex brokers across the globe. This platform works as your expert advisor. This platform is extremely thorough and professional and offers a wide range of trading tools.
There are a number of FX robots available in the market which comes packed with many different features. It gets really difficult for a trader to choose one from thousands. A trader has to be very careful in placing his choice. As a trader, you should always choose an FX robot that suits your style of trading.
The automated trading version requires no human involvement. It comes with the in-built market encoding and trading algorithms. The FX robot detects the trading signals in the market and automatically executes them on a trading platform. The trader can only adjust some parameters like robot settings and risk exposure. Rest everything is done by the robot.
The semi automated trading version is usually programmed in a way that enables it to detect potentially profitable market conditions for the trader. It is extremely beneficial in the times when it is difficult for the trader to identify the favorable market conditions. In this version after analyzing the market trend the robot places a trade signal and leaves the final decision of trade execution on the trader.
The most commonly asked questions by the traders are:
Which FX bot version works best?
For an experienced trader with an excellent trading strategy, it is advisable to choose a fully automated FX robot system as they can code the trading strategy into a forex robot using the services of a programmer. Traders who only need assistance regarding trade signals and want to be assured of their forex account may opt for signal based trading robot.
Are there any profitable forex robots?
There are several companies, which develop and sell forex robots. More than 78% of these are just a piece of trash wrapped in an attractive “get rich”, “instant riches” packages. Some also offer a money back guarantee. Be aware of such offers and make a wise decision before choosing one. Do not buy the testimonials on the sales pages of the forex companies as they could be paid reviews with no actual relevance to the product’s credibility. Instead, join online forex forums to know other people’s experience with the product. This is the safest way to gather genuine information and worth the price of the Forex robot.
What are the advantages of a Forex robot?
A forex robot is a machine with no emotions. It will only follow your set of rules and trading plan. The best thing about a Forex robot is that it will not panic, become greedy or scared no matter what the market conditions are. Before testing a Forex trade on a live market, it will be good to test it on a demo Forex trading account for at least a period of 3 months.
A Forex robot will stay on until you turn them off. The robot will keep an eye on the market trend and trade according to your set rules even when you are not around. This is a very effective way to capture more and more market opportunities and increase your profit margins.
A trader needs a couple of years and thousands of dollars to develop an understanding of the market. When using a Forex robot you do not need to build any strategy the robot will do it on your behalf. In this way, a Forex robot is a very cost effective way of entering the trade.
Money management is the golden principle of Forex trading. A robot that comes with a built-in money management system is a boon for the trader. The client only needs to customize the robot according to his risk profile and other needs. This is an advantage especially for those who do not have much knowledge about the market.
A Forex robot works only on set parameters. It is not flexible and may not allow you to take an advantage of a short term profitable position if it is not encoded to do so. You cannot just buy a robot and assign it a task to earn you hundreds of dollars. In order to assign the task to the robot you need to know the basics of Forex trading like reading chart patterns, currency pairs, determine the loss you are ready to incur etc.
To summarize, a robot should only be used as an additional mechanical strategy to your trading pattern as there is no substitute for a good human judgment.