With so many new people getting involved in forex trading these days, it seems everybody is trying to find some kind of short cut to make it a little easier. We all know that trading is risky, but there are still lots of new traders happy to get involved because the chance of making very good money are so great. Some traders put their faith in automated trading systems, and in this article we're going to look at why that's usually a bad idea.
Naturally, one of the most important requirements if you want to trade profitably is having a proven trading system to follow. Your system will have parameters and rules that tell you when you should get into, and out of, each trade. Since there are hundreds of forex trading systems around, it's critical that you do some research and digging before you choose the one for you.
But even if you do that research and find what you think is the perfect trading system, it's certain that you'll lose money in the market on some trades. There's simply no guarantee any trade or series of trades will make a profit, regardless of what system you use - that's just the way it is. But something that's often held up as a way of increasing your chances of success is what's called an Automated Forex System.
An Automated Forex System comes with an automated trading robot that makes currency trades for you so you don't have to sit there and watch the market. In other words, the robot works on autopilot, buying and selling currencies, based on pre-determined formula programmed into the system.
Sounds like a good idea on the surface. In theory, it means that all you have to do is check on your robot trader occasionally to make sure that it's working, and the system's parameters are calibrated correctly. Over time, your trading account balance will grow on it's own, without any input or decisions from you. As I said, it SOUNDS like a good idea... in theory.
OK, now it's time for a reality check. Why would somebody sell a piece of software to anybody if it really made forex trading that easy? They would keep it to themselves and profit from the market themselves (at least most sane people would). Give me a break...
Here's the bottom line. DON'T fall for the old 'our forex trading robot will solve all of your problems' fairy tale. There are no doubt private traders, institutions and hedge funds that have multi-million dollar automated trading systems that are profitable. But never assume they are the same 'forex robots' you see advertised for a hundred dollars or so. Nobody is that benevolent.
The only real way to make decent money trading forex is to learn from a trader who knows how to teach you. Then get a free demo account from a broker and practice using that system until you can confidently trade the market. There IS no shortcut shorter than that. Find a good trader who's willing to share what he knows, follow that, and you might just succeed as a trader.
Naturally, one of the most important requirements if you want to trade profitably is having a proven trading system to follow. Your system will have parameters and rules that tell you when you should get into, and out of, each trade. Since there are hundreds of forex trading systems around, it's critical that you do some research and digging before you choose the one for you.
But even if you do that research and find what you think is the perfect trading system, it's certain that you'll lose money in the market on some trades. There's simply no guarantee any trade or series of trades will make a profit, regardless of what system you use - that's just the way it is. But something that's often held up as a way of increasing your chances of success is what's called an Automated Forex System.
An Automated Forex System comes with an automated trading robot that makes currency trades for you so you don't have to sit there and watch the market. In other words, the robot works on autopilot, buying and selling currencies, based on pre-determined formula programmed into the system.
Sounds like a good idea on the surface. In theory, it means that all you have to do is check on your robot trader occasionally to make sure that it's working, and the system's parameters are calibrated correctly. Over time, your trading account balance will grow on it's own, without any input or decisions from you. As I said, it SOUNDS like a good idea... in theory.
OK, now it's time for a reality check. Why would somebody sell a piece of software to anybody if it really made forex trading that easy? They would keep it to themselves and profit from the market themselves (at least most sane people would). Give me a break...
Here's the bottom line. DON'T fall for the old 'our forex trading robot will solve all of your problems' fairy tale. There are no doubt private traders, institutions and hedge funds that have multi-million dollar automated trading systems that are profitable. But never assume they are the same 'forex robots' you see advertised for a hundred dollars or so. Nobody is that benevolent.
The only real way to make decent money trading forex is to learn from a trader who knows how to teach you. Then get a free demo account from a broker and practice using that system until you can confidently trade the market. There IS no shortcut shorter than that. Find a good trader who's willing to share what he knows, follow that, and you might just succeed as a trader.
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