Expert advisors are the technological mean to automated trading. Using these advanced scripts one can execute trades at ease as human interaction is out of the equation, and the orders are automatically placed on the platform.
The proper implementation of an EA requires planning, testing, optimization, consistent strategy, and risk and money management.
The majority of forex traders create expert advisors that are successful in the short-term, whereas in the long-term are proven to be a failure.
Expert advisors: Advanced software scripts
Why is that throughout time such software scripts fail to operate. Are all such systems functional?
The answer to the above question is simple. If your expert advisor’s script fails to implement appropriate risk and money management, in addition to a valid and logical strategy, then losing your payroll is unavoidable.
The most common strategic methodologies used in expert advisors are scalping, swing, and trend trading.
The first automated strategy is one where the trader executes his or her orders for a limited period of time, from seconds to minutes.
The second automated methodology is one where the automated script speculates, via ”swing” patterns, for trend reversals.
Last but not least, trend trading is mostly a much slower tactic, more of a weekly speculation.
Furthermore, the expert advisors are not only used to help one automate his or her strategy, but can be set in such a way to offer signals to traders, and for social trading purposes.
Signals help the traders who have no time to spend on their trading station but wish to place their orders manually once they receive an expert’s signal.
Moreover, mirror trading is a social type of platform where the traders (followers) who have no time to spend on the platform, and wish their orders to be executed automatically, connect their account to the master trader’s account.