What are the Forex trading robots?
Category : Robots
Forex robot is a unique trading platform, which is working 24 hours a day and 5 days a week (from Monday to Friday). Significant market players and speculators are trading non-stop. However, it is an unrealistic task for a trader to trade 5 days in a row or manage 5 trading sessions one by one. Still, there is a comprehensive solution that was developed by etf traders in a world of information technologies. This is a trading robot.
So what are the trading robots, which are also called “the trading advisors”?
A trading robot is an algorithm of the particular actions on the forex market. Basically, the robot is a program that makes decisions based on the parameters which were installed into it. The trading system is a perfect robot algorithm. In simple words – the robot automatically does the trading for a trader.
It is an artificial intelligence that actually works for you.
Forex differs from the other markets (stock and commodity ones) by the increased volatility. That is why scalping robots are the most common type used in the forex market. There are different kinds of the algorithmic systems, so you should pay attention to the key features while choosing a forex robot.
What do you need to pay attention to while choosing a forex robot?
-The type of transactions (scalping, day trading, position trading);
-The algorithm of transactions (trading system or a set of indicators);
– Parameters of maximum drawdown set in the algorithm;
– Mathematical expectations of robot performance;
– The volume of trading.
Worth mentioning, that the trading robot you choose would play an important role in the profitability of investments and would directly affect the further financial results of the trader. If you buy ineffective robot you would not only spend the money but also investment funds, which would be managed by the robot. Therefore, you should be sure in a trading robot you choose.
How to choose robots for the work on forex market correctly?
There is a list of criteria which you should investigate, to choose the robot for the work on forex market.
- Check the financial criteria data and the trading operations statistics. Also pay attention to the key indicators, such as drawdown, the rate of return, recovery factor and profit factor. Positive indicators would guarantee getting profit from trading.
- Find out if there is an optimization tool in the trading robot. Forex market is changing very fast and currency pairs change their trends rapidly. Your robot should be able to adjust to the trends and optimize itself to the market conditions.
- Check the results of the robot’s work for its current clients. Besides statistics, there are also trading results, represented in the client’s accounts. They should be also examined. After you investigate the reviews about the profitability you can make final a decision whether or not purchase a forex robot.
Trading robots allow the traders to save their time by providing the market analysis and the search of the prospective transactions. Robots are doing all these operations instead of a trader and work the full trading session. It means that trading robots are able to conduct an analysis of almost any currency pair and decide on the purchase or selling, based on the implemented algorithm. This allows increasing the potential of profitable trades and profitability.
According to the data of the US stock market, 80% of the trade operations are made by robots. This number can be much higher, considering the high volatility of the forex market and the big amount of time needed to access it. Large players of the forex market, such as banks and hedge funds use trading robots that can demonstrate a return of more than 1000% per annum. Of course, such robots are not available for public, but the development of this trading segment allows you to find or create a forex robot which would bring a positive result.
There are many types of trading robots. Here is the list of the most commonly used ones, however, there are more:
Therefore, these robot types correspond to different trading strategies, which are based on various parameters. So, the first step to get familiar with forex trading robots would be to check their relevant reviews.