Making money in the Forex market is not easy. What is easy though is losing money. The relatively unregulated retail forex industry has been exploited by thousands unscrupulous companies and individuals all too willing to take some of your hard earned cash away from you.
It is hard to think of an industry with as much false marketing hype. There are many hundreds of sellers ready to exploit the desire of ordinary people to earn some extra cash on the side. The allure of using automatic trading software, otherwise know as Forex Robots, to do this on autopilot is very tempting. But be aware that up to 98% of new traders lose money in this market.
Forex robots can appear very attractive to new traders for a number of reasons:-
* They remove all human emotion from trading, making rational trade decision based on a set of defined parameters that have historically proven themselves.
* They perform complicated calculations to try and determine the likely movement of a Forex currency pair
* Good Forex robots can adapt to changing market conditions.
* They place trades for without the need to be on your phone or computer.
There our many thousand of these software products on the market. Some are free, but most of those that work are available at a price, ranging from $5000 to $50. The vast majority of these Expert Advisors, or EA's are useless and will end up losing you money. Fortunately there are a few that have stood the test of time and have been proved to deliver profits over years rather than week or months
In looking at the marketing sites of the very many vendors of these products, what you will invariably not find is the following advice.
* Understand the trading Strategy built into the System. If you want to put your hard earned cash into the hands of a Forex robot, you should know to how it generates its trading signals, so you can have confidence in its logic. Not all trades will be positive, in fact you only need 50% plus successful trades to make money, but you need to trust the system to give you more successful trades than losers.
* Only consider those with proven Real Time Results. Most automated Forex robots show stunning "back tested" simulated results which is notoriously unreliable. Ignoring forex robots with no independently evaluated real time forwarded tested results will allow you to focus on the 10% of the cream. Only consider real time results over an extended period.
* Be Realistic Be watchful of sellers of EA's claiming outrageous returns. You should expect the following in your selected system: A monthly profit growth of around 5%. A drawdown's on your equity of up to 20%. Don't panic when this happens, because a good robot will recover this for you. Losing periods of a few weeks to a few months
* Trust your Selected Strategy and Stick with it If you are trading a system that you have carefully selected based on your analysis, then stick with it and judge it over an extensive period e.g. 1 year. Expect losing periods knowing that long term result count. Look for a robot that is regularly updated to take account of market changes.
Using a proven Forex robot along with a dose of common sense can earn you a useful second income. But don't be caught out by the marketing hype and rush into buying the robots which appears to be the best thing out there. Look for a good Forex testing and review website to help you make your decision
If you are tempted to enter the Forex market, you should think carefully before rushing in and buying the most hyped up Forex Robot. You need to do your research to find for those with a sound profit making track record. See the top selling robots on test at http://www.forexrobotstest.com
Article Source: EzineArticles
