Do Forex Robots Work
Hi,
I have some questions about forex. I saw that there are many forex robot, software for trading in forex in autopilot.
1. Do they work? If yes, which is (or which are) the best(s) in the world?
2. Can they cause a money loss?
3. I’d want to begin to trade. If I use one of these robots can I reduce the risk?
Thank you.
1. Yes they work. The best in the world are never revealed. Why would anyone share it or even sell it, when the robot makes thousands or hundreds of thousands?
2. Yes, they can. Not all robots can adjust to the market changing behavior. Even the best ones may become inefficient over the period of time as the old tendencies die and new rules are born.
3. You certainly can reduce the risk, because when robots trade, they don’t fall victims of psychology, fear and greed; humans, however, do.
Good luck in your trading!
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Comments
Posted On
Nov 05, 2009Posted By
Glory1. Yes they work. The best in the world are never revealed. Why would anyone share it or even sell it, when the robot makes thousands or hundreds of thousands?
2. Yes, they can. Not all robots can adjust to the market changing behavior. Even the best ones may become inefficient over the period of time as the old tendencies die and new rules are born.
3. You certainly can reduce the risk, because when robots trade, they don’t fall victims of psychology, fear and greed; humans, however, do.
Good luck in your trading!
References :
Posted On
Nov 05, 2009Posted By
sburtonhomeIf you have spent anytime researching Forex you have undoubtedly come across one of the many Forex "robots" (EA-ExpertAdvisors) for sale. BE CAREFUL. Do they work? Sometimes. It depends on the fundamental reason behind the autotrader’s system. These fundamentals can change at anytime as the market changes. If you are unaware of what makes the "robot" work and/or do not understand what moves the Forex market, you will lose money eventually.
Let me give an example. A friend of mine wanted to get into Forex but wanted to trade on his own. He went out and bought a Forex robot that had been winning for the previous 5 years. He started trading it with a demo account and had great success for the first 2 months. This gave him confidence and so he put $150,000 into a Forex account and started trading his money with the auto trader. His first month live went well. But then something happened that he didn’t even realize. The Bank of England changed it’s interest rate policy. This one change drastically changed the fundamentals behind why his "robot" worked. In a matter of 2 months his $150k turned into almost $0.
Now my friend made two grave errors. 1) He didn’t know what he was doing and trusted in the author of a the system that really didn’t entirely understand either why his system worked. As soon as the market changed the system stopped working. 2) As he started to see his money started shrink, instead of stopping and asking what was happening, he kept trading because the author of the EA kept telling him that the losses would turn around. It wasn’t until he had almost nothing left that he stopped.
So to answer your question. BE CAREFUL. Yes they work. But YES you can lose money. Using a Robot WILL reduce your risk but only to the extent that you know what you are doing. We have built a "robot" that we use for one of our systems to manage complex formulas in a matter of seconds that get us into the market more efficiently and saves us and our clients money. However, we would never trade an EA that we didn’t know the fundamental reasons why it worked.
References :
Echo FX prides itself on being an honest, disciplined Forex account manager and educator. http://www.academyofforex.com (education) – http://www.echocurrency (forex account management)