What are EA’s? Everyone who is trading forex came across EA’s or at least should have. EA stands for electronic advisor and many know them as forex robots. This is basically a coded trading strategy which will execute a trading strategy automatically without the forex trader being present. EA’s or forex robots are very popular and plenty of marketing is spent on them by their creators. There are countless of EA’s available, some are free of charge while others are offered for a fee.
3 Reasons you should avoid EA’s #1: They are often designed with poor trading strategies, but marketed very well. Sometimes you can find a very nicely designed indicator or a very complicated one in order to appear more professional. There may also be plenty of data to support this, screenshots from MT4 accounts, history and other material which in many cases has been fabricated. Try to look behind the glitz and glamor and dig a lot deeper before spending money on an EA.
3 Reasons you should avoid EA’s #2: An EA is essentially a newbie trap. Everyone who enters the market as a new trader knows that there is money to be made trading forex. It is natural that you lack knowledge as a new forex trader and many are just not patient to learn. They are driven by the profits, are lazy and do not wish to learn. This drives them to what they think is a quick solution. Marketers of EA’s are aware of this and create campaigns to attract the get-rich-quick mindset. Serious forex traders will stay clear of this.
3 Reasons you should avoid EA’s #3: Remember that an EA which you purchase will make money, but not for you but for the creator of the EA. You spend money on an EA which means that the EA is generating money just not in the way you have hoped for. It is a big marketing machine and real forex traders stay away from short-cuts. Creators of EA’s do not need to trade forex as they earn a passive income from selling to new traders with the wrong mindset. This is one way to profit from forex.
Is every EA bad? No, not at all! The best EA’s are the once which you have coded with your own trading strategy. There is nothing wrong with making use of technology, but before you can code your own EA or hire someone to do it for you, you need to first spend the time to learn how to trade. You need to create your own trading strategy, test it and then you can go ahead and code it. Put in the hard work to reap the rewards. Forex trading is very rewarding, but not for lazy people with the wrong mindset.