principles and different algorithms. Instead of a trader researching the market on their own, Forex trading robots are predicting the currency market and deciding whether to buy or sell a pair at the time.
These bots can be successfully used on other markets as well, not being limited only to Foreign Exchange. Their main advantage is removing emotional aspects and focusing only on facts. The vast majority of bots are integrated with the MetaTrader platform and can be used on MT4 or MT5.
Another name for a Forex trading robot is Expert Advisor or EA. Since it has the ability to conduct thorough research and initiate trade, its function is similar to human financial advisors.
Anyone can use EAs as long as they have a platform that supports them. As mentioned, MetaTrader has the best options and the most significant number of already integrated Expert Advisors. On the other hand, you can create your own EA based on the trading parameters you typically use or would like to use for market research.
There are several things you must know before choosing the Forex trading robot. First, go through the website of the robot you want to buy and find all the information. If you can get in touch with someone from the company and ensure there’s a person behind it, even better.
Test the Demo account. Something is not quite alright if you cannot test the robot before purchasing it. You can open a Demo account with a broker that supports the MetaTrader platform and connect the bot or try it right there on the website. Note that photos and videos can easily be manipulated, so don’t trust anything you cannot test on your own.
If the offer sounds too good to be true, it’s not a good option. Many scammers will try to lure you into buying their robot based on false results and fake promises. No robot can make you thousands of dollars overnight risk-free.
Check out the underlying strategy and the design. Sometimes, the robot will use a certain strategy you’re not keen on using, or its overall design won’t be intuitive enough.
Finally, consider the price of the said robot. It’s no use spending too much money on something you may or may not like. Vague between the price and the value before choosing the best Forex trading robot for you.
First, check the market conditions the robot is made for. There’s no point in using the EA during market disruption or important macro-releases unless the bot is designed for such usage. Otherwise, it may show as an utterly useless tool.
You can let the bot work if you know the conditions, e.g., everyday market predictions at regular times. Install the MetaTrader app or use the web version provided by the broker and integrate it with your EA (in case you’ve created your own). If you intend to use the Expert Advisor already on offer, just choose and let it work.
Note that you can use several robots simultaneously as long as they apply different market strategies. You can get a more accurate picture of the potential profits by comparing the results you’ve got.
Currently, there are no laws that would forbid Forex trading bots. While some say they hurt the market and put some retail traders in a favorable position, there’s no legal framework to support these complaints.
Note that some brokers have the right to ban bot usage on their platforms, for example, high-frequency trading bots or those based on price quote manipulation. Using these EAs can hurt the broker, which is why they have the optional right to prohibit it.
However, not all brokers ban the same bots, so you can always find the one allowing you to use the tool you wish. As long as you create a bot for yourself and use it on your own, there are no legal limitations.
Forex trading robots have many advantages. Compared to traditional trading, they’re saving you time, enabling you to open more positions since there’s no market research of your own. Further, they’re utilizing coding languages, such as Python, MQL, or Java to predict the market, meaning emotions are excluded.
Let’s go over all the advantages of using FX bots.
Instead of researching the market on your own, the bot does it for you. It compares various events on the financial market, checks the asset price history, and uses advanced algorithms to predict future movement. Therefore, it can save you a lot of time.
As mentioned, trading bots rely on facts such as price history and market events. It doesn’t consider emotions or any psychological moment.
Since this is the case, it can objectively observe the market and make the decision. It can save you lots of losses due to rushed decisions.
Using bots, you can diversify your portfolio. Since you’re not predicting the market, bots are finding different opportunities, checking assets you would not remember to check yourself. Further, since it takes less time to investigate, bots can open more trades simultaneously.
As with everything, there are some bad sides to using Forex robots as well. Since it’s an entirely technology-based tool, there can be different system issues. Further, bots may not see the big picture. Finally, they cannot do due diligence and manage risks appropriately.
Bots are technological achievements. As with any tech tool, they are prone to system glitches and small mistakes. If an error occurs, you have nowhere to complain. This is a risk associated with using EAs.
Bots are following the script. Whether it’s pre-written or you wrote it yourself, they’re focusing on the guidelines you gave them. Since they’re incapable of thinking, they cannot see the big picture and change in a different direction.
Finally, bots cannot manage risks. They cannot do due diligence as you can and cannot manage risks. If the algorithm gives an order, the trade will be open, whether you like it or not.
MetaTrader4 has a feature enabling investors to develop, test, and apply various Forex trading bots. This platform features MQL4 IDE (Integrated Development Environment), allowing you to apply multiple bots and technical indicators.
The software has some built-in EAs, while it also allows creating your own bots and implementing them through the IDE component. Besides using it, you can make your EA available to others through Code Base, sell it on the market, or “rent” it to other users via Freelance service and receive compensation.
Trading bots have been prevalent in the past few years thanks to their ability to elevate trading to a higher level. If you’ve been scammed by a fraudulent brokerage selling fake trading robots, contact Global Fraud Protection. We’ve been exposing cyber fraud for years and will continue to do so. That’s why we need your story.
Forex trading robots are legal to use. There are no laws that would prohibit the usage. The broker itself might impose the limitation if the bot can harm their business in any way.
Since trading robots are software, they don’t need a license. However, a broker that provides you with a certain trading robot must be fully licensed to provide financial services.
Legit trading robots created by other investors or large companies are safe to use. These are genuine technical tools for trading on the Forex market. Au contraire, many scam brokers offer non-existent robots to lure investors into depositing funds. Be wary of these.
Forex trading robots are legal to use. There are no laws that would prohibit the usage. The broker itself might impose the limitation if the bot can harm their business in any way.
Since trading robots are software, they don’t need a license. However, a broker that provides you with a certain trading robot must be fully licensed to provide financial services.
Legit trading robots created by other investors or large companies are safe to use. These are genuine technical tools for trading on the Forex market. Au contraire, many scam brokers offer non-existent robots to lure investors into depositing funds. Be wary of these.
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