Should Inexperienced Forex Traders Be Using Forex Trading Robots?
If you visit the sales page of many of the forex robots being sold on the internet
, you could argue that the vast majority of them are aimed at inexperienced traders and people new to forex trading. So with that in mind, I want to ask whether these people should really be using these robots.In my opinion anyone considering using one of these expert advisors should have some prior knowledge and experience of currency trading before using them. They certainly shouldn't be trading real money if they are new to this game.
The reason why I say that is because if you have some experience behind you, you can then properly evaluate how profitable one of these robots actually is in reality. Furthermore if the robot is just about profitable but not making a great deal of money, you can then look at the trading conditions used by the robot and adjust them accordingly to create your own manual trading system, which could potentially be a lot more profitable.
The major problem faced by people new to currency trading is that they have very high expectations of these robots. This is hardly surprising because the sales pages often make huge income claims, supported by backtests showing thousands of dollars worth of profits in previous months. However most people find that when they start using one of these expert advisors on a live trading account, they simply do not achieve the same kind of results.
Many of these inexperienced traders are also quite naive about the kind of losses that they may encounter as well. Anyone with any experience will know all about drawdown, and how big positions that go against you can quickly destroy your trading account, but many newbies will put the expert advisor on autopilot and see what happens. Sadly when they make a bad call, or worst still two or three bad calls, and the positions are still not closed, the drawdown can wipe out your account very quickly and give you a very nasty surprise.
So overall I would say that on the whole forex robots are not really suitable for people who are relatively new to forex trading. In fact they can be very dangerous in the wrong hands. That's why I think it's vital that you have some experience behind you when employing one of these robots because you can then set your own stop losses and tweak the entry and exit rules to create your own more profitable system if necessary.
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