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.
Of course in order to trade profitably, you must have a good system to follow. A forex system is a set of rules that dictate when to enter and exit the market. If you've looked around, you already know there are hundreds of forex trading systems available, so it's important that you do some due diligence before choosing the one you are going to use.
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.
Now you're probably thinking that this sounds like a terrific idea, and a lot of people do. In theory it means that all you have to do is check on your robot every few hours to make sure he's working away properly and he isn't doing anything wrong. And they only cost a couple of hundred dollars to buy too. Sounds like a great idea doesn't it? What could possibly go wrong?
But now it's time for a quick reality check. Why would a system developer sell something that really worked that well to anybody else for such a low price? Who would be so happy to share their knowledge and expertise to make forex trading for everyone else? NOBODY! (I checked).
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.
Of course in order to trade profitably, you must have a good system to follow. A forex system is a set of rules that dictate when to enter and exit the market. If you've looked around, you already know there are hundreds of forex trading systems available, so it's important that you do some due diligence before choosing the one you are going to use.
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.
Now you're probably thinking that this sounds like a terrific idea, and a lot of people do. In theory it means that all you have to do is check on your robot every few hours to make sure he's working away properly and he isn't doing anything wrong. And they only cost a couple of hundred dollars to buy too. Sounds like a great idea doesn't it? What could possibly go wrong?
But now it's time for a quick reality check. Why would a system developer sell something that really worked that well to anybody else for such a low price? Who would be so happy to share their knowledge and expertise to make forex trading for everyone else? NOBODY! (I checked).
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.
About the Author:
Learn more about forex trading and how it can help you become a better forex trader. And stop by complete currency trader review for more tips and advice on trading the forex market.
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