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3 important notes before you buy a trading robot
Automatic Trading System, so-called Expert Advisor (EA), is a system coded to help traders trade on the market without constantly monitoring the trading platform. Normally, there are two EA types: free and paid. Of course, the paid one is usually better than the free one as they are made and tested carefully by the professional traders who are able to earn from trading. Today, we will discuss the pros and cons of the paid EAs.
When should you buy a trading robot?
You purchase a robot in order to make money from trading since there are reasons making you unable to trade yourself (too busy, too emotional on market’s fluctuations, etc). Therefore, you have to understand the EA developer perfectly. Three following questions must be answered:
Why did the creator make the EA?
What is the winning percentage of the EA?
Does the creator offer a guarantee or a money-back if you aren’t satisfied with the EA’s quality?
Please have in mind that not all free trading robots are bad. There are many effective EAs among the free ones, therefore, you have to consider carefully whether it’s worth ordering a paid robot.
1. Why did the creator make the EA?
This sounds useless, but actually, it’s not. Let’s consider the programmer’s promises about the robot. Are those promises realistic? Such an introduction like “this EA has a win-rate of 100%” or “you can double your balance within a week using this EA” is extremely illusory and hints for a scam as there are no systems that win all the time. Moreover, if the system brings a 100% win ratio, why would the developer have to build a website, create a sale team and offer promotions to sell it while he can use his own EA to profit from the market?
An EA is considered reliable only if the seller is a trader who has already known how to make money from the market, and has already done that. He must know the trading principles to establish for his automatic system. That system must be proven by a confirmed result and the developer’s prestige.
2. What is the winning percentage of the EA?
Nowadays, there are many websites that enable EA sells to publish their verified trading results. You just need to check the statistic and the trading history of the account to which the EA is applied. That’s the most realistic information circumstantiating whether that robot is worthwhile or not.
Please note that the testing period must endure at least 6 months. It’s much better if the EA is tested on a real trading account with a relative investment amount (at least $1,000) as it proves the creator works responsibly on his system.
3. Does the creator offer a guarantee or a money-back?
This is the most transparent element proving the EA’s reliability as it shows the creator’s confidence in his developed system. If he offers a guarantee or a money-back within an acceptable period (normally 30 days), then this is a sign of reliability as you can request to get your paid amount back in case you are not satisfied with the system.
Another type of guarantee is to have a third party holding the payment until you finish testing the EA. However, there are few creators accepting to do it.