Discover how to automate your MT4 with Expert Advisors, the ‘forex trading robots’ that can help you start algorithmic trading.
Expert Advisor example
A correctly-programmed Expert Advisor can monitor dozens of markets, meaning you don’t have to watch price movements 24 hours a day in order to find new opportunities. How much time you dedicate to the markets is up to you: you can use your EA for trading alerts but open and close positions yourself, or merely keep an eye on your running profit or loss.
Emotion can be problematic to your bottom line. It might encourage you to hold on to a losing trade for longer than you should, because you don’t want to realise the loss. Or dive into a reckless trade too quickly, riding high off a big gain. Automating your trading helps take the emotion out of your decision making – an algorithm only views the markets in black and white.
An Expert Advisor can be programmed to take into account any of the information that’s available in the MT4 platform. So whatever your preferred trading strategy, you should be able to find – or create – an Expert Advisor to execute it for you.
Building a strategy is just the beginning, and trusting it to take care of your capital is a big step to take. That’s why most traders will backtest their Expert Advisor before letting it loose on live markets. Backtesting involves running your strategy against a chunk of real historical data and seeing how it performed, helping you to iron out any issues before they end up losing you real money.
However, it’s important to note that backtesting isn’t completely foolproof. Slippage, for example, can’t affect your trades when backtesting – but can be an issue once you set your EA live.
While undoubtedly major benefits, in truth the above four points all apply to any automated trading system – not just Expert Advisors. But while building a trading algorithm from scratch can be complicated, importing an EA just means choosing a program and suiting it to your needs.
The easy accessibility of EAs is probably the biggest reason for their popularity as an automated trading tool. But while a well-coded, fully backtested and properly monitored Expert Advisor can be hugely beneficial to your trading, there are some major pitfalls to avoid that all traders should be aware of.
What is a virtual private server?
How do I install an Expert Advisor?
How can I backtest my Expert Advisor?
Can I test my Expert Advisor on a demo account?
Can I build a Custom Indicator with an Expert Advisor?