Forex Trading Robots – Why Banks and Serious Traders Don’t Use Them

Forex trading robots are sold as an easy way to make money with no effort so, why don’t banks and major dealing houses sack their dealing teams and save millions in annual salaries – Why? Because Forex robots lose money…

It never seems to occur to traders that the Forex robots sold heavily online, say they have better track records than the world’s top fund managers and yet, anyone can get instant wealth (if you believe the sales copy) by spending just a few hundred dollars. Doesn’t add up does it?

The reality of Forex Robot trading is that users quickly lose money, because the robots don’t work and are based on unsound logic.

They use back tested simulations over historical data and then a make hypothetical track record of gains but this is easy, as you know all the closing prices and when they trade forward not knowing this key data, they fail and lose money.

Because these systems have bent a track record to fit the data in hindsight, don’t have any proper money management rules. Losses are huge and as money management is the key element of successful Forex trading, a wipe out of equity soon occurs.

As yet, no major banks, brokerages or fund managers, have sacked there dealing teams on millions of dollars in salaries and replaced them with a team of Forex robots.

The buyers of these robots tend to be naïve or greedy investors, who dream of instant riches and are rewarded with a wipe out of equity.

If you want to win at Forex trading, get yourself a decent Forex education, learn skills and your efforts will be well rewarded.

Forex Trading Robots – Why Do We not Give Up our Jobs and Use Them?

I checked a forex trading robots track record the other day and if I ran my trading account size on its track record I would be making $324,000 a year! Not bad for an outlay of a few hundred bucks. People fall for these track records, yet they always lose why?

Because their greedy, think forex trading requires no effort or they simply don’t read the disclaimer which is tucked away in the small print.

If you see a track record of a forex automated trading system on the net with this disclaimer then it probably spells a wipe out of equity here it is:

“CFTC RULE 4.41 – Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown”.

So they are not real time profits there paper profits made looking backwards! Would you trust the above?

I know I wouldn’t!

It amazes me how many people buy these unproven systems.

Most of the track records are so good, you wonder why the vendor even bothers selling it – he could make enough money by trading it. Of course he doesn’t, because he knows it won’t win and that’s why you never see a real time track record.

Do savvy forex traders use them, do you see them in bank dealing rooms or do you ever see anyone who has made long term money with them – No you don’t.

Today there is a huge industry in these trading systems and they appeal to the naive and greedy traders, who won’t to make money with no effort.

Of course in life you get out what you put in and forex trading is no different.

Forex trading can offer you the ability to make huge profits and even a life changing income – but you must have the right mindset and get the right forex education.

A forex trading robot probably will destroy your equity – but you don’t have to take the lazy path!

Forex is a challenge, an exciting one, with huge rewards so accept the challenge, get the right forex education and you can enjoy currency trading success.

Forex Robots – the Fantasy of Easy Profits the Reality of a Swift Wipeout

Of course the theory appeals, plug in a robot and it automatically starts giving you trading signals and you pile up huge profits but this is fantasy land, most will simply wipe your account out and do it quickly…

There are several robots that proudly present back tested track records on what they could have done – but there is a problem here:

You don’t get the advantage of knowing the closing prices in the real world of trading! I can be a millionaire many times over, if I had the future prices today – but I don’t.

Simulated Dollars V Real Dollars

Most of the robots you see (certainly the ones heavily promoted) have track records with simulated and in hindsight written all over them. This proves nothing – its real dollars made, that are the acid test.

Most robots go even further, by presenting there track records better than most fund managers (that’s guys who are paid seven figure fees or more) and yet all you pay is $100! There is no real drawdown (even the best managers will draw down for weeks or months) and 20 – 30% of equity is no uncommon. Doesn’t really add up does it?

I know lots of brokers and as yet, I have not seen a 100 buck robot put them out of a job.

The other thing that always strikes me is the small amounts, you can supposedly turn into large amounts and $100 is often quoted as a minimum.

How do you ride out a drawdown period on that?

Look for Real Dollars

Not all forex robots come with simulated track records and you do get some with long term track records. These have drawdown and realistic gains of between, 30 – 100%, over 3 year holding period. Always look for some real hard evidence that the forex trading system you buy has been applied in the real world of trading.

Anything less than 2 year track record should be discarded.

Most traders want an easy way to make money ( we all do!) but if you are an adult, you know life and making money is not a walk in the park, its hard at times but you can get rewarded if you work at the basics.

Build Your Own Quickly

You can build your own forex trading system and customize it to your risk tolerance; it’s far easy to do, than most people think. If you do build your own forex trading system, you will understand it, have confidence in it and can apply it with discipline for currency trading success.

Reward Requires Effort!

The forex markets offer huge rewards but alas most of the forex robots you see won’t help you win. No effort – no reward in forex trading. So be realistic and get to work, get some proper forex education and your all set to enter the exciting world of global currency trading and win.