Expert Advisor – Why Most Of Them Failed And How To Identify The One That Truly An Expert

If you’re not familiar with the words “expert advisor”, you may have heard these: Forex Robot, Automated Forex Trading Software, or simply EA (short for Expert Advisor). Basically, they are all just different terms for one thing: an automated script that run under your MT4 trading platform to watch the market for potential trade, maintain positions, and place orders by itself without any trader interventions. Theoretically, this can be very useful since no human trader can bear to watch the 24/5 forex market continuously.

Most expert advisor are written in MQL-4 programming language and designed to run under MetaTrader 4 trading platform. These advisors can help you in two different ways: send you info when a profit opportunity occur at the market (AKA trading signal) or taking over all your job as a trader by automatically analyzing, executing orders, putting stop loss and take profits order, and managing open positions by itself. Read more about the benefits of using the second version at forex software – the trading robot .

If you’ve been a fan of manual trading for a while and have got your share of profits, I know that it sounds too good to be true. Offering cheap software that can outsmart you in trading forex is sounds like most of scammer will do anyway. Well, there is truth in that way of thinking; over the years, there are many investors lose their money because they trusted their fund to be managed by an EA. It turn out that most of these EAs are not “expert” at all since all that they can do is get winning trades in backtesting (testing them against past market data), not in real live trading. This is the facts and it still happening now.

“I knew it” is probably what you think now, but there’s another side of the coin that you must know too. It is purely logical thinking and not rocket science at all, so bear with me for another 2 minutes.

If you’ve been trading for a while you must’ve known that every successful trader have their own trading system that can works without fail in their area of expertise; maybe swing trade strategy on USD-JPY currency pair, maybe long term 3-7 days strategy on GBP-USD, maybe intraday scalping method on EUR-USD, or maybe they have a few set of strategies for different market condition. Nevertheless, all of them following a set of rules while trading and they gain steady profits by follow it with strict discipline.

I’m sure you’ve got the picture now. All the EAs are just a bunch of codes that executing what they’ve programmed for; to be exact, they’re merely executing the rules behind them, these rules are what make them truly “expert” or truly “trash”. If the rules (AKA the trading system) behind them is set by a real professional trader who uses the same set of rules to generate profit in live trading, the EA become true “expert”, but if the rules is set by some idiots who can only modify its program to match past data, the EA become “trash”.

How to differentiate them? The method is simple; just open a dummy account, place your EA there (you still have to spend some money on VPS though), and test it for at least a month, thus you can see if it is really profitable or not against live market movement. Most of them are “forced” to offer 60 days 100% money back guarantee due to the merchant rule, so you’re safe to test it during that period. You can get $100,000 MT4 dummy account at AvaFX; read more about them at a report of AvaFX online broker.

Do not let those scammers make you lose potential profits from forex trading; it is true that more than half of the current EA at the market today are trash, but a few of them are really backed up by a real trading system that qualified to manage and grow your fund. Check and test the top recommended forex robot at best performed forex robot .