Let’s talk a minute about automated forex “robots”. This is something that comes up a lot amongst new investors, because they really feel that they just can’t trade without them. They will make so much money, they say. They will be able to finally give themselves the financial freedom that they always wanted to have. Is that really the case?
Well — yes, and no. You have to make sure that you understand forex before you invest in software. This really isn’t a push button solution. If you’re going to do any type of automated trading, you have to understand what the machine is trying to replicate. If you don’t understand that, then you’re really not going to have much of a clue when it comes time to start analyzing your trades.
The analysis portion is one of the top ways that forex people make money in the first place. If you’re not starting with that, then what’s the point of being a forex investor at all?
Forex robots are good for very specific purposes. For example, if you already have a strategy and you just need automation, then this is where you can get software involved. On the other hand, if you really don’t have any type of clue of what’s going on in the market, you are better off sticking to manual trading until you get a better grasp of everything going on.
You might be pulled in by the slick advertising that companies pick up. They can promise you a 500 percent return on your deposit every month, but that’s out of the bounds of reality. Challenge the company to let you see a real money forex account where this is happening and verified by a third party monitoring site. They are out there. If a company can’t back up their claims, then you need to steer clear of them.
If you’re doing anything on the MetaTrader platform, you’ll find a lot of Expert Advisors. These are pieces of software that do make your job a lot easier, but you will need to honestly look at everything going on still. They can be programmed to automatically execute trades on a live account. For all of their power, this can be dangerous as well. The software can only do what it is told to do. So if your logic isn’t perfect, the software’s logic isn’t going to be perfect.
There is a human element in forex that should definitely be embraced. Don’t give up — you can learn what it takes to be a successful forex investor!