How To Choose An Expert Advisor
As I mentioned in my previous post, there is at least one independent forum which allows Forex Expert Advisor users to post reviews on the experiences they have had with various Expert Advisors available on the internet.The one I use and like the most is Forex Peace Army, a very popular forum/review site which has reviews of pretty much every forex robot you are likely to come across. I have posted FPA review links to the right of this article, for every EA I am promoting on this website. A couple of the links are new and have no reviews yet as the robots concerned have only just been released, however as time passes you can be sure that users will post there.
You will notice as you read these reviews that some of them are not very complimentary, so I am definitely not hoping to make a lot of sales of those Forex Robots! However, please feel free to browse and make up your own mind. This is not a long list at this time, but I will add more links in the future. The Forex Expert Advisors you see on the left are a mixture of the good, the bad and the indifferent so please do not think that by linking to a Forex Robot website I am in any way recommending or endorsing the robots being promoted there. The links are there as an indication of what is available.
Whatever Forex Robot you end up choosing, there are certain ground rules when it comes to trading with Forex Robots, or any forex trading for that matter. Firstly, a rule of thumb is that the larger the initial deposit and the smaller the lot size you trade, the safer your trading will be. Some “newbies” may think that they can start a live forex account with $100 and make thousands of dollars. It really doesn’t work like that. As there is a minimum lot size that can be traded on Metatrader (with brokers who offer micro accounts the minimum lot size is 0.01), the more you can possibly deposit the less likely you will lose your money. Most experts recommend at least $500 as a starting deposit.
The reason for this is the dreaded D word that forex traders love to hate: drawdown. When a trade starts going the wrong way and stays that way for days or even weeks, that is known as drawdown. That trade is using up your trading capital, and the more it goes in the wrong direction, the bigger the drawdown, and the fewer new trades you can open. If the drawdown gets large enough in relation to your account balance you will get a margin call and the trade will be closed by your broker. Hence the need for a large deposit, to cover the drawdown until the trade reverses and comes back into profit. With the Forex Goldmine Robominer EA that I have been using, which only trades EUR/CHF and AUD/NZD, 2 currency pairs that tend to trade within a limited range, I have noticed that drawdowns can last for up to a month or longer before reversing, so you really need to have plenty of room in your account to hold these drawdowns and still open new trades. Some trades on the other hand will open and close on the same day and you need to be able to take advantage of these while still waiting for the more difficult trades to close out.
Please note also that Robominer and some of the other EA’s do not use stop losses. This strategy demands in my opinion a starting deposit of at least $1000 and trading MUST start on the minimum lot size of 0.01 and stay that way until the account balance has doubled to $2000 when you can then increase the lot size to 0.02. If you see the graph in the previous post (see above) you will notice the negative result of trading with excessive lot sizes, a setback that traders would prefer to avoid. Please remember that you do have the option of investing with a bank or mutual fund if you want the ultimate safe guaranteed return. That puts forex trading in perspective: yes the gains can be fantastic but being too ambitious as you start out can lead to disappointment and the loss of your precious trading capital. If you aim at making 5% per month however, which is easily achievable with forex trading, and still way better than you will get from a bank, you will not be tempted to increase the lot size after a few weeks of trading.
Please read the first post on this blog about compounding. That is how the money is going to be made in the long term: by retaining capital in your trading account over several years and maintaining a safe (meaning low lot size, high deposit) strategy, and compounding your returns over a longer period. This is all part of the mindset of a good forex trader: avoiding fear and greed. Fear of losing your starting capital might lead you to minimize the amount of your initial deposit, while greed is the motivator that would make you want to increase the lot size you are trading in an attempt to speed up the results. Both emotions are the enemy of wise trading, as any experienced and successful trader will tell you.
Thank you for reading this post. Happy robot-hunting, and may your Forex Auto Trading be safe and profitable!
Greg Annett
Great information, I will be linking back to you and going to look around at your other posts.
Great info here, nice site I will be checking out the other articles you have and linking back to your site.
Great read, you can always learn something new about forex!
This is interesting! How did you learn the subject when you were a newcomer to it?
Now this comments about Trading Forex is really one of the best Ive read on this exellent topic. I agree with your views and am looking forward to your new posts. I’m grabbing your rss feed to stay informed of any updates.
What a fine way to bring up
Where there’s smoke there’s fire, I always say. You couldn’t have put it more succinctly, and I’ve seen a lot of posts on this topic. I can’t say I agree with all of it, but it sure hits the mark better than most.
Where there’s smoke there’s fire, I always say. You couldn’t have put it more succinctly, and I’ve seen a lot of posts on this topic. I can’t say I agree with all of it, but it sure hits the mark better than most.
The GBP fell against all of the majors after Prelim GDP did not meet its forecast forecast of 0.4%; coming in at 0.1%. Additionally, BBA Mortgage Approvals were 45.9K versus its forecast of 46.0K and prior reading of 44.7K. Lastly, the Index of Services 3m/3m was 0.1%; also not meeting its expectation of 0.4% but better than the prior reading of -0.2%.
Thanks for this post. I am always looking for more information on forex. It is such a dangerous market that any information helps. Thanks.
Hey I am thinking of buying an expert advisor by the name of forex cash protector. do you know anything about it.
Yes I recommend Forex Cash Protector FPA’s test shows an increase in equity.