Forex Expert Advisors. Taking the emotion out of trading for profit

One of the many benefits of expert advisors (and trading models more generally) is that they offer traders a disciplined framework within which to operate. For those who find the emotional pressures of discretionary trading an issue, they are therefore a valuable solution. However, as Andy Webb explains, they also open the door to other opportunities not economically feasible for a human trader, such as diverse strategy portfolios.

First Published: e-Forex Magazine 55 / Automated FX Trading / January, 2014

For any trader looking to automate their trading, one of the first questions is what type of expert advisor (EA) or trading model to chose? That can depend upon any one of several factors including available trading capital, risk appetite and previous manual trading experience.  Daniel Fernandez of Asirikuy, sees two broad groups here. “It mainly depends on whether they are looking at short-term or long-term profit objectives,” says Fernandez. “That in turn usually depends a lot on their available capital and their experience. Those with less trading capital tend to look for high gains over shorter periods at higher risk, while those with more money tend to do the opposite.” The reasoning behind this is typically associated with the way in which those two categories of strategy tend to perform. Longer term strategies, such as trend following over days/weeks/months, can often exhibit poor short term performance because their trading logic easily results in them being...continued

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