How to choose the right robot trader

Forex accounts are traded either by humans or by computer programmes called robots or expert advisors. Humans always display one excess or the other because of their humanity. They either get too greedy, or exhausted, distracted, careless or simply inexperienced. This can lead to losses. However, with good money management disciplined traders still do well despite and sometimes even because of their humanity. Computer programmes avoid all the human excesses and trade strictly according to a programmed logic. They do extremely well in normal markets but do not possess “intuition”, which saves many a trader in extraordinary markets, nor can they grasp the current economic climate in order to switch trading style to fit it.

However, with good money management programmed in, they still do well. In my experience though, the best “trader” is a human – robot combination where the trained human trader serves as the eyes and the ears of the blind and deaf expert advisor.

So, how can we safely choose a forex robot to manage our funds? It would depend largely upon your expectations for forex account growth. Some investors want aggressive growth and are ready to stomach the risks associated with such speedy growth. For such investors, aggressive robots would be what they would want to look for. Others would rather prefer slow but steady growth. Such people would want to look for careful and conservative robots but should not expect fast growing accounts. Comparing both methods, however, good aggressive robots occasionally experience fairly large losses, while conservative traders do not have returns that might be termed exciting enough to justify investing in forex as opposed to other investment vehicles. So, a balance must be found. It is this balanced robot we would be looking for. One which can take aggressive risks when warranted and slow losses aggressively when trading conditions are not ideal for it. Identifying such a robot can only be achieved by looking through the robot’s live (real money) account statement, which details its live trades over time. Some of such statements often come with a graphical representation of account growth with respect to time or number of trades. One look at that equity growth graph and you can easily tell if that’s the type of robot you want. Trading histories for periods of at least six months to a year or more are generally sufficient to evaluate the efficiency and consistency of a robot.

Robot trading or expert advisor auto-trading can not be discussed without mentioning the role that has been played by the Metaquotes Corporation. Metaquotes is a Russian software maker, whose flagship product is the Metatrader trading platform. This platform is the most popular around because of its ease of use and vast versatility. It is deployed by hundreds of brokers trading everything from gold to forex, CFD’s (contracts for difference) to stock indices and oil. One of the greatest features of the Metatrader platform is its open auto trading ability. With every installation of Metatrader, an expert advisor or robot programming interface is included. Any proficient programmer can quickly grasp the constructs of the programming language used in expert advisor creation and create simple expert advisors. This has spawned a thriving industry in the creation, hiring and sale of proven profitable expert advisors. Today, there are thousands of expert advisors available for use. Metaquotes also organizes a yearly expert advisor trading championship. This has greatly popularized the development and use of expert advisors. Every year during this championship, new concepts in expert advisor programming are tested in almost completely live trading conditions using virtual funds. Hundreds of robots run completely unattended for three months vying to earn the $80,000 prize money, free marketing and fame bestowed upon the best three expert advisors creators. This year the contest has again commenced and is currently three weeks old. As I write, the leading expert advisor is already 600 per cent up with many more robots in hot pursuit. For more on the current championship visit championship.mql4.com and click on “participants”. You can choose any particular participant and view their actual trading terminals.

Well, I always recommend in my little way this trading platform http://tinyurl.com/65njow

And always remember Tread Carefully !!

Uzoma Eze

Comments

  1. Interesting – because that is the same thing I found out last Thursday.

  2. Hello, I can’t understand how to add your blog ( forexfixedodds.com ) in my rss reader
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  3. Greatings,
    Can i take a one small pic from your site?

    Have a nice day
    Elcorin

  4. uzomaeze says:

    hi can you explain, what you mean

  5. uzomaeze says:

    not to worry i will soon install the rss fee thing on the site so you can use it cheers

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