SHOULD YOU FEAR FOREX ROBOT TRADING?
The first impression of most forex robot is one of too good to be true. Can you really get rich with a software program that costs a few hundred bucks? You probably know the answer to that question already. In this post I will explain the difference between various forex robot strategies and that you do not need to worry about blowing up your account if you select a good strategy.
Why is the term “blowing up my account” so common. Well, the explanation for this is very simple. It’s because forex robot traders make the same mistakes as manual traders. Greed is their guide and dollar signs pop up in their eyes by just checking some live account statements. Also the bad fact checking is the main reason why forex traders lose money. I can’t emphasize enough that a single screenshot of any account is zero proof of anything. Even a live track record is not a guarantee that you will be rich soon.
Some years ago the Martingale strategies (not to be confused with a grid strategy) were the most traded robots. Showing huge profits at the first glance, but soon ending up in a disaster. And whats funny, is that Martingale is a system that nobody would use when going to a casino, so why use it with your own money?
A martingale or grid system increase positions that are “off” and therefore could blow up your account. So before going live make sure you understand the trading mechanism. Obviously you can contact us with any inquiry about our published forex robots.
Depending on the lot size we can qualify the following strategies:
Basically the risk is mostly depending on your account size. So in case you have a little budget, better not trade a grid or martingale strategy. Trend strategies are the way to go where you will be allowed to change the settings such as lot size and stop loss.
So where to start with a small budget?
All traders realize at some point that they just need the help of an algorithm to support their trading. Either fully automated or semi (indidcator). For those that never traded a robot before I can suggest two EA’s that you can test in a live account and where your risk will be acceptable. Because you can adjust settings, such as stop loss, trailing stop etc, you can minimize your risk.
Two strategies qualify as ideal strategy to start with;
So how does it work?
Both EAs have great money management settings where you can trade as little as 0.01 lot. So 10 losers in a row would cost you about $20. The first step to overcome your “fear” for automated trading is to trust your computer or VPS and the software. This can only be achieved by trading with real money.
Forex Robots have evolved a lot over time and the technology really helped with this process. It’s no longer gambling but a serious attempt to beat the markets constantly without having to spend valuable time.
Feel free to contact us in case you have any questions.