Will Robots Replace Human Traders?

Forex robots, Robots replace human traders

A forex trading robot is a computer program based on a set of forex trading signals that helps decide whether a currency pair should be bought or sold at a given time.

Forex robots—when it comes to Exness MT5 — are designed to remove the psychological aspect of trading, which can be detrimental.

While trading systems can be purchased online, traders must be careful when buying this way.

In the first place, trading is understood as the operation of buying and selling all kinds of financial assets. Due to the extraordinary rise of this tactic in finance a particular type of trading has been developed in recent years: automatic or robotic trading.

This trading consists of intelligent software that automatically performs such purchase or sale operations. It is possible thanks to an algorithmic trading system. The most favorable situations in the market are sought by the investor, who has previously established specific parameters to which they must react.

With this programming in the operations, the robots can act 24 hours a day, a characteristic that would be impossible for human beings.

Robots in Trading — How They Appeared and Their Usage

Forex trading robots are automated software programs that generate trading signals. Most of these robots are built with MetaTrader, using the MQL programming language, allowing traders to create trading signals, place orders, and manage trades.

Automated forex trading robots are available for purchase on the internet, but traders should be careful when purchasing any such trading system. Companies will often come overnight to sell trading systems with a money-back guarantee before going a few weeks later.

Types of Trading Robots

Cryptocurrency Trading Robot

The purpose of the crypto trading robot is to be profitable by investing in the cryptocurrency market, that is, by buying a bitcoin or another crypto asset.

Automatic Trading Robot for Forex

This typology is created to operate in the foreign exchange market, especially on Metatrader 4 and Metatrader 5.

Binary Options Robot

In this type of robot, although great returns can be generated in a short period of time, the risks involved are high.

CFD Algorithmic Robot

These trading robots are based on financial derivatives, contracts for difference or CDFs, and agreements between two parties that exchange the difference between the entry price and the exit price, multiplied by the number of agreed shares or indices.

What Robot Makes Better/Worse Than a Human?

Forex traders may want to consider developing their automated trading systems rather than risk third-party forex trading robots.

The best way to start is to open a demo account with a forex broker that supports MetaTrader and then try to develop MQL scripts. Having developed a system that works well while retesting, traders must apply the program to paper trading to test the system’s effectiveness in live environments. Failed programs can be modified, and successful programs can be increased with more significant amounts of natural capital.

Many traders try to develop automated trading systems based on their existing technical trading rules. Some of these systems are more successful than others. An example of this is a trader watching a breakout and has a specific strategy to determine the stop-loss and profit point.

These rules could easily be modified to operate in an automated way instead of being executed manually. Traders should monitor these systems to ensure they are working as expected and make changes when necessary.

Great Success Robot Trading Stories 

Carry Trade Robots based on currency risk premiums can have up to 6% per year, currency momentum strategies can have up to 6% (maximum 8% drawdown) profit, and robots based on the currency value factor.

The best performing forex robots are time-series momentum-based robots where traders can trade bonds, stocks, commodities, forex, and hedging positions simultaneously and achieve up to a 12% better return % profit per year.

The important thing: the results of all these robots are realistic because they were tested on large data sets, on invisible data sets, and not overfitted.

Robots on the Internet (many expert trading advisors who do not have proven scientific proof of hidden data) that many programmers sell show indicative results and unrealistic false results.

For example, if we have a three-year bull run for some stock or currency pair and create a robot that will buy more than it will sell than when we tested that robot, it will show extraordinary performance. In live trading, it will be evil.

Forex trading also has various trading styles and strategies. Many experts and efficient traders in the Forex market can guide you properly.

The general function of Forex is divided into two parts: one wants to trade using a manual trading system, and others wish to change using an automated trading system.

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