That’s fine, but the conventional wisdom among buyers of forex robots is that forex robots should help them make money. So how do you go about figuring out whether or not a forex robot can help you make tons of pips?
Well, the answer is actually pretty, but first let us tell how not to figure out how good your forex robot is. Never test a forex robot out on a demo account and never rely on the back-tested results that are always present on the sales pages of forex robots. This is the ultimate sales ploy. Now we’re not saying all forex robots are bad. They’re not, some are good, reputable products, but be leery of back-tests and simulated results. We’ll show you why.
Live Accounts Are The Only Place To Be
To be clear, trading in a demo account is a fine idea for a new forex trader. It’s a good way to get some of the basics of forex trading down and identify your strengths and weaknesses. On the other hand, forex robots don’t belong in the world of demo accounts. This is because forex robots may take unnecessary risks in demo accounts or trade pairs you don’t want them to trade or do a host of other things you wouldn’t want the forex robot to do in a real account. That’s why you can’t really “audition” a forex robot. There’s no dry runs, just set it loose in a live account with a small amount of money.
What happens if you insist on relying on back-tests and demo trades? Well, at the very least you’ll see that forex robots are apt to deliver very different results in a simulated setting compared to the ones you’ll see in a live account. And this could leave frustrated and wondering where you went wrong when in reality the only thing you did wrong was to not test your robot in a live account. The worst thing that can happen is you stick with an underperforming forex robot waiting for it to deliver the same results it did in a demo account and while you’re waiting, the forex robot suffers big losses and blows out your account.
What Are Your Options?
We’ll say it again: Your best option to get the best possible read on how good a forex robot is to commit to letting it trade in a live account. You don’t have to set it loose in a standard account. Try a micro or mini account with just a couple of hundred dollars in it. This way you’re risk is limited and you still get live results for forex robot’s trial run.
Retired Canadian Economist. My main activity since Winter 2006 is trading Forex. I’ve been trading currencies online with the help of EA’s (BTW, the best source for EAs is www.forex-robots.com ) and I currently manage trading accounts at two Forex brokers in the US and in UK respectively
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