In addition to the convenience of trading with forex trading robots, the process eliminates the urge for traders to trade based on sentiments or based on psychological reasons. Forex trading robots are able to generate trading signals which trigger certain trading responses, shortening the trading time and allowing traders to capture more trading opportunities. These robots may be purchased online from third parties or they may be “self-developed”.
Self-developed trading robots are created by the trader himself or by someone who the trader specifically hires to create the robot on his or her behalf. The advantage of creating your own forex trading robot is that you have the flexibility of building it to suit your own particular trading style and preferences without worrying about buying a third-party robot that has a short lifespan due to the disappearance of the developers shortly after rollout.
Traders should avoid the urge to purchase third-party forex trading robots from developers that make elaborate promises based on limited back-testing. There have been some instances of traders purchasing third-party forex trading robots only to have the developers disappear shortly afterwards, leaving the trader high and dry with a hole in their pockets. Self-development may be a viable alternative to purchasing a forex trading robot online.
If you opt to go the self-development route, a good approach may be to start by opening a demo account with a forex broker that uses the MetaTrader trading platform. Once the demo has been set up, you may start experimenting with MQL scripts, conducting lots of back-testing to ensure that the system is performing as expected. Once you are satisfied with how the robot performs, traders may test it out using paper trading on actual live trading platforms. The testing process should be ongoing, and tweaks should be made as deemed necessary. The more satisfied you are with the performance of the robot, the more capital you can afford to invest in real trading. However, be sure to only make incremental increases until you are confident in the performance of the robot. Self-developed forex trading robots should incorporate all the trader’s preferred trading rules and practices. This includes rules for placing stop losses, placing trades, taking profits and so on.
A well-built forex trading robot should operate similar to the actual trader, but without the need for the trader to make decisions on the spot for each trade. Instead, the trading decisions are programmed into the robot beforehand, and are executed automatically as the need arises. Traders who are not interested in building their own forex trading robot should spend some time carefully choosing a third-party forex robot – preferably one that has been around for awhile with a good track record.
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