How to choose an Expert Advisor For Forex Profits

Look on the internet for a trading robot and we will be bombarded with web pages with many sellers making the claim that with their robot easy money can be made. The robot alone is enough to make us rich!

All this carefully crafted sales junk creates an illusion that using an Expert Advisor is easy, just set up the robot and it will make you money.

In the beginning most robots will make money but it’s more difficult to get the robot to earn money consistently over the long term.

A trading robot has a set of trading rules programmed into the robot. These trading rules dictate how the robot opens and closes trades and these could be based on an indicator or a series of indicators.

To develop a trading robot a developer tests their systems with historical data and through continued testing the system is refined to produce a trading system that makes money.

We must be aware of a few pitfalls for the developer as all market conditions will change over time. If an automated system is tested only over a short time period, then the automated system will only produce results for this type of market condition.

A system that has not been tested over a large time period will not be robust enough to survive these changes. Therefore we must find a trading robot that has been tested over the long term to ensure we maintain profitability.

By looking at a how long a robot has been tested for will give us an indicator of whether a robot is robust. These sales pages will show the length of this testing and if the testing has only been done on a short time period this is an indicator of a potential scam.

If a sales page shows us long term results then we should be encouraged that this robot has been backtested over many market conditions.

When buying a trading robot we need to look at who takes our payment. Good system developers use clickbank marketplace and this is good for the buyer. If we are unhappy with the robot clickbank will give us our money back (within our money back guarantee time limit).

Only buy from vendors who give you your money back, this gives us the opportunity to test our robot without any financial risk. If the robot is rubbish we can always get our money back.

When we have bought our EA we can set it up on the metatrader4 platform and once we have set it up we can start to test to see if the robot is any good. This can be done with historical data.

IMPORTANT; the historical currency data provided by metatrader4 is not the best. This can lead to distorted results so we need to use extra tick data to get the most accurate results.

To get the best from your EA you need see how it tests. I look for 2 main things when testing. The first is the most important, can I set a stop loss. For me controlling my trading risk is the most important part of trading.

Being able to control my stop loss allows me to feel secure that only the money I choose to risk is at risk and the second thing I look for is the EA’s parameters; if I can control the EA’s parameters I can fine tune my robot. This gives me more control in changing market conditions.

If the robot does not have variable parameters or a stop loss then we should ask for our money back. If the robot does have these things we can start to do our testing using our tick data.

I run tests on short time periods and this can be from 2 weeks to up to 3 months as I am looking to test an EA to select the correct settings for my forward trading. I then backtest for 2 weeks and find the most profitable settings for this 2 week period.

The settings that gave us the best results over the 2 weeks are then used in our forward trading. After the week of forward trading we would repeat our back testing procedure. This would include the week we had forward tested. This new test would give us our settings for the next weeks forward trading.

Now we know that by selecting a trading robot that can be tuned to the market can give us an automated way of making money. We also know that only through the use of tick data can we achieve testing results of sufficient quality to make it profitable.

Find out how to make forex profits as an forex trader on autopilot and make profits on auto pilot. Or Learn forex trading basics at my website and start your forex trading tutorial.

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