There has been a long-standing question with automated Forex trading. Is it truly effective? Or a mere scam? Also called Auto FX trading, this automated computer program executes trades instead of human traders manually executing trades. This program is made by either personally creating the program, purchasing one, or obtaining it free then assigning it to the trading platform. There are FX platforms nowadays like MetaTrader 4 and MetaTrader 5 that can easily accept these kinds of programs very easily.
Advantages of Automated FX trading
What makes this automated program very appealing to traders is its advantages. With Automated FX trading, any emotional factors are removed from the process. You won’t be worried about your trades getting influenced by emotions which then clouds your decisions. To add to that, automated trades can also be executed 24 hours a day, giving the trader some free time away from the monitor. This advantage is especially useful for those who also have corporate jobs. They don’t have to focus all their time on trading and do their other work without worrying on the outcome of their trades.
Disadvantages of Automated FX Trading
Unfortunately, nothing is perfect in the world. There are also sets of disadvantages that this automated program can offer, one of these is the technical problem that the software could encounter. When there is a bug in your trading software, it will make poor and unnecessary trades that can instantly blow up your account.
Additionally, if you purchase a program that has secret rules, it can be totally scary to leave your hard-earned cash to them and letting them run your trades only to find your account totally blown out. For this particular reason, backtesting becomes a necessity. Remember to be extra careful before entrusting them with your money.
How Forex Automated System Works
These programs are also referred to as robots, auto traders, and expert advisers. No matter their name, they all work the same. There can be different ways to set up certain kinds of the automated system but their operation shares the same things
Download and Install
Upon acquiring the program, you have to download it from the original source then install it to your trading platform. The setup will be taking a couple of steps only. Basically, this software works as an add-on to your platform. This makes it easy to install and uninstall in case there’s something wrong with the program.
Semi-automatic and Automatic Categories
This automated system falls into two categories – the fully automatic program and the semi-automatic program. For the automatic ones, they will be placing trades instead of you while for semi-automatic, they will just give you signals or suggestions on when to place a trade.
The Automatic System Does Everything For You
This type of program does all the trading work for you. They have a specific algorithm that influences these decisions. They are also mathematically operated. The algorithm to trades are hidden away so as to protect their intellectual property.