What is a Forex Robot

So, with the world moving toward automated trading strategies and computerized trading models, one has to ask, “What is a forex robot?” That’s an easy question to answer, except for the fact that it varies greatly from robot to robot.

Forex robots were originally designed to profit on opportunities that humans were too slow to take advantage of. Arbitrage is the perfect example here, as robots capable of instant buy-sell ordering can effectively buy and sell whole lots of currencies in a matter of miliseconds to make money on pricing discrepancies. That is, if one broker were to offer EURUSD at 1.3400 and another at 1.3405, then a trader with a 2 pip spread could take down a profit of 3 pips, guaranteed, in a matter of seconds.

Such a trade is not very profitable in terms of a raw percentage gain; in fact, it works out to less than 3/10000ths of a percentage point. However, if one were to evaluate the opportunity in terms of dollars, and with a trade size equal to 100 lots, it could be quite plainly seen that the trader would stand to make $30 per lot, or $3,000.

Even better is that by employing a robot to do the data crunching and buying and selling, no human need even bother get out of their bed. Instead, a carefully designed computer system could know immediately which trades were profitable, which ones weren’t, and decide on its own to make trades on its own.

Welcome to the New Trading Environment
While personal computers, cell phones, and other gadgets become more technologically advanced by the day, few of us can even begin to describe how quickly the computers have evolved that trade the foreign exchange market. With over $4 trillion changing hands on a near daily basis, it stands to reason that anyone can make an absolute killing in foreign exchange provided they have the capacity to 1) code a forex robot or 2) purchase a currently existing forex robot.

Today, most forex robots are sold online, and are generally not very good investments for the buyer. This comes down to the simple concept that if you had a risk-free way of generating large profits, why would you sell it for mere pennies compared to what it could make in the markets? Would you sell a brand new car for $100? Absolutely not. So why would you sell a forex robot for only a few hundred dollars? If it worked, you wouldn’t even begin to sell it for that price.

So where can you find forex robots?
The best forex robots are those that you create yourself. While an understanding of popular trading desks like MetaTrader4 is encouraged, a number of software companies have now opened up the pipelines for individual investors to turn concepts into robots. That is, with only a small minimum investment, often less than $100 for the time of coding, you can turn a concept for a trading system into a perfect forex robot—and many people have!

There is a reason why so many people who go to work on Wall Street are now going there not with finance and accounting degrees, but with computer science degrees—Wall Street needs more automators! While individual investors are just behind the curve in forex robot development, many coders and traders are paid millions of dollars for profitable systems. Imagine: you go to work each day and create new trading systems, the bank then tests them, and if they prove profitable you receive a cut in the form of an annual bonus each year for the rest of your life.

This scenario plays out daily, as the world’s best computer experts decipher code to create the best financial modeling systems. While most of the development happens on Wall Street, there have been numerous occurrences where individual investors armed with nothing more than MetaTrader 4 have created perfectly functioning “Expert Advisors” that trade their own accounts, at home, and achieve automated profits.

If you enjoy breaking down the markets and looking for new opportunities, you’re the perfect person for the world of automated trading. Go get it!

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