FINANCIAL FOREX INVESTMENT

The deregulation of the Forex market, now offers small investors and traders the chance to trade the Foreign Exchange and this has produced a dramatic increase in automated Forex trading systems. These provide the home based trader with a ‘set and forget’ trading methodology, where the trader installs a Forex robot onto their brokers charting system, selects their chosen inputs and the robot takes over. ..well that’s the theory.

There are many people who are selling Forex robots who have claimed to have found this Holy Grail, and though there are some fascinating Forex robots available, extensive testing by experienced traders has shown up many failures in the claims made by the vendors.

Most of the Forex robot sales claims are based on historical crestor generic ‘back testing’ results, not live account testing and depending on what platform you are using and the substantiation of the historical charts you access, these will and do vary wildly. We have never yet been able to mirror the results presented on a sales page. Some Forex robots we have evaluated were incredibly efficient at cleaning out our demo account, so tread very cautiously.

Demo accounts are known for producing much better results that live accounts. Demo accounts will always fill a trade, whereas live accounts are subject to spread variations, slippage, and liquidity, plus broker quirks and lot sizes, just to mention a few influences. So when you stop and think about it, if a Forex robot cleans you out on a demo account, how do you think it will go live???

I would love to, but, I am not going to provide the Forex Robot failures, no, I don’t want to get sued!

How does an automated Forex trading system work?

Simply, an automated Forex trading system dissects and interprets its own series of indicators, then determines entry and exit strategies based on its interpretation. It trades automatically, based on risk management factors and aims to make a profit. It will also close the trade, in line with its pre-coded parameters.

Most of the modern Forex robots run on Metatrader4, which is a very common trading platform and they should have narrow trading spreads, often 2-3 pips, occasionally up to 5 pips. It is not unusual for a robot to “bed down” before they begin trading. Some Scalp, which is taking small quick trades and others trade over longer periods and all will have loosing trades. You must make sure the robot has stop loss strategies built in, some don’t, so check carefully!!

This is another way Forex robots enhance their supposed performance look good. Without a stop loss strategy, they allow excessive draw-downs, keeping the position open until it returns to into profit. If the draw-down is large it can also send you broke since you may not have the money in your account to hedge the loss, so your broker will close the trade.

If you don’t have the time to day trade and want to use automated Forex trading, there are a couple of Forex robots we use, these two robots are constantly updated by their developers, so we regularly watch their performance and keep them up to date, it’s all part of our personal risk management strategy for automated Forex robot systems.

To find out more about these Forex Robots, we review them at Automated Forex Reviews, you will also find other Forex Trading tools.