The Forex industry is one of the fastest in terms of success and growth. In 2019, the market reported a daily turnover of $6.6 trillion dollars. Due to the numerous perks it offers to users, and especially because of the potential earnings, many decide to dip into Forex trading. Lucky for users, there are tools that make this more promising, easier, and more effective.
One such tool is a Forex Expert Advisor.
What Are Forex Expert Advisors?
At some point in your trading career, you’ll experiment with systems that facilitate the process. The most successful traders use systems and software solutions called Forex Advisors for this process.
FA’s are basically a type of software that has preprogrammed rules and algorithms for initiating, reporting, managing, and tracking trades in a given market. Right now, there are plenty of Forex Expert Advisors available to users. Let’s see why you need this in the first place.
Do You Need A Forex Expert Advisor?
The best way to make this important decision for your trading is to check the advantages and disadvantages of using an FA.
Let’s start with the advantages:
To this day, Forex trading is the only market in the financial world that operates non-stop. Since it operates on its own, you can do what you want while it works, and know that someone is tracking everything even when you sleep.
If you activate the trading bots in your FA, these will quickly discover and act on great opportunities. What might take you hours and days to find will instantly pop on the software’s radar, and the computer speed in taking action is incomparable with that of human traders.
No Emotional Factor
When you’re trading, emotions are a huge part of your actions and decisions. Forex traders are automated, which eliminates the emotions from their actions. They act solely based on data and your pre-set requirements, not on emotions based on past losses or fear.
Quick Adaptions to Market Fluctuations
Forex robots get information from many sources in real-time and execute trades in the blink of an eye. A human trader, on the other hand, will take much longer to analyze the changes in the market and any new information they come across, so they might miss great opportunities because of it.
Traders need to become familiar with the metrics of their strategy including things like maximum drawdown, average win, and average loss, win percentage, profit factors, trade expectancies, and more. Knowledge of all these is what makes a good and promising trading strategy.
The best way to get to such data is by performing backtesting. Doing this manually is a challenge, to put it lightly. But, for an automated tool, this is a breeze and takes very little time.
Multitasking at Its Best
You might be able to track several currency pairs at once, but it will be challenging. Imagine this, a tool that can multitask and keep track of as many pairs as you want it to. The great trading robots available today manage and hold various trading accounts, all at the same time. This eliminates time constraints, maximizes speed and consistency, and saves you tons of time.
It all sounds amazing, right? Knowing all this, it becomes obvious why traders use such tools, but let’s take a peek at the disadvantages, too:
Data Can Be a Double-Edged Sword
Collecting data is what trading robots are all about. If you are using a robot, it’s important to make sure that you aren’t over-optimizing the system. What does this mean? It means that what you enter into the software can determine how it reacts in the future, and what data it takes into consideration.
Most of the Robots are Limited
Unless you choose one of the few well-rated robots with a multitasking ability, you might not be able to trade several pairs all at once. This is why it’s very important to find a tool that allows you to trade several instruments.
Technical Failures Do Happen
Some of the robots sold nowadays are constantly tracked and updated, so glitches almost never happen.
Based on all that you’ve read so far, do you want to buy a Forex Expert Advisor? The advantages beat the disadvantages tremendously, so the decision is quite obvious. The best part is, if you find a great advisor to use, the disadvantages shouldn’t even be in the picture.