Volatility Factor

Monday, October 24, 2011

The Secret Behind Forex Robots

Forex robots are making waves. They are believed to have provided numerous benefits to traders who are taking advantage of their support capabilities. Why are Forex robots successful? Forex robots are also known as Expert Advisors or EA. They do live up to their name since they are said to have helped in the $3 trillion market turnover everyday in the Forex market.

As an expert advisor, Forex robots provide advice and information about when to buy, sell and close a deal. The expert advisor interprets and identify the trading signals that they are able get from analyzing the Forex market.

What do they do?

• Forex robots provides indicators when a trader would enter or exit a deal. Some traders would like to be notified first before the robot enters a deal and the trader would manually enter the deal or exit from it. But the EA could be programmed so that it could automatically enter a transaction. The trader is also responsible in providing the stricture from where certain trade information and signals would be determined.

• Aside from entering or exiting a transaction, the Forex robot can also be programmed to perform trade tasks like buying or selling.

• Fore robots can apply your money management strategy to their program and incorporate it in the trades that they do. Money management is all about determining how much you are willing to buy and sell, or the risk factor involved in trading. Some traders would not include money management and would go for a free strategy. But this could be a costly mistake, so it is better to make sure that the Forex robot already has money management or you could input algorithms in the system to integrate your own management style.

• Forex robots are also capable of placing, changing and removing stop losses. It could also take orders.

To operate a Forex robot or an EA, you necessarily need a computer, stable internet connection and at least some knowledge on how Forex trading works. You would also have to sign up for an account with a Forex broker, they would be providing a trading program. This trading program would be monitoring the Forex market and enable you to perform trades manually. After setting up an account, you can get the Forex robot from a manufacturer. The EA would be downloaded to your computer and would make trades for you.

But there is a certain difficulty when using a Forex robot. Although they can do the trade for you 24 hours a day and 5 days a week, it is impossible to keep your computer working for that long. So, there are some companies that offer virtual hosting where traders can continue trading while giving their computers and trading robot the needed rest.

These service providers would just require necessary information so that they can host your trading platform. They would be providing you would a username and password to have access to your server. When looking for services like this, it is important to have a demo account first where you can check the service before foregoing into trading real money and account.

But as reiterated by experts, having an automated trading system, in this case the Forex robot, is not an assurance of succeeding in trading and becoming a millionaire. It still relies on your trading skills, knowledge and mindset.

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