subject: The Profitability Of A Forex Robot [print this page] As a long time and avid trader of the markets, originally Emini and now the Forex markets it has given me a unique view into how to trade. I have reached a point whereby studying the charts, concentrating on a computer screen endlessly no longer inspires.
A long and hard evaluation of the myriad of Forex robots, which seem to be the ideal way to go, (if they work) has eventuated. What can I tell you!
Do they work, can they work. The answer is that surprisingly a large number of them do to some extent, with a few that perform in a good and reliable manner.
What is their secret. Their secret is quite simple, and can be outlined in a few bulleted terms.
a)Conservative trading style
b)Money management
c)Small consistent profits
d)Realistic stop losses in place.
Let us elaborate on the points above.
A conservative trading style is adopted by those few which are worthy of being called an Automated Forex Trading Robot. They do not trade incessantly, in fact most only trade 1 or 2 times a day, and sometimes will not trade for a few days.
They are not looking for the long haul trending profits. They are looking for the highest probability of profit.
Often this will be in the hours when the US market primarily is not open. i.e. no news to affect the market dramatically.
Money Management and the control of risk is all important. No more than a certain percentage of trading capital should be risked, normally 2 to 3 % at maximum. The better robots are well aware of this.
Small consistent profits with realistic stop losses in place. The hardest part of entering any trade is where to place the stop loss. Too tight a Stop loss and normal market activity will hit it every time.
Too wide a stop loss and the losing trade will dissipate the gains of the last 2 or 3 profitable trades. A fine balance here, which is well controlled by the better robots.
In Summation, Automated Forex Trading Robots have not solved the universal quest for the risk-free trade. They have not found the magic formula whereby the money just flows endlessly. What they have formulated in a commendable manner is a balanced and non-emotional approach to sensible and profitable trading.
I personally utilise them solely for my trading. They do work and do maintain profitability.
They are improving all the time. If a commonsense, practical and conservative approach is made to your trading then substantial profits will result.
