Forex trading robots began to be glimpsed by some people. Trading robots or expert advisors (EAs) can be a lifesaver in forex trading. The reason is, EA can work alone looking for open trade opportunities, open sell, stop loss, and buy in the forex market.
In fact, the Commodity Futures Trading Supervisory Agency, is said to be going to regulate the use of EAs because they are becoming more and more popular. A source said the regulations are being discussed and are expected to be finalized by the end of this year.
However, not only opportunities, but forex trading with robots can also be disastrous if not used properly.
Director of PT Solid Gold Futures Dikki Soetopo said that the robot system can execute according to instructions. However, keep in mind that the ability of a forex trading robot is strongly influenced by the developer, aka humans.
For those who are busy and don’t have time to monitor the market all day, he thinks using a trading robot can be the right solution.
What beginners don’t realize is that trading automatically will make them untrained to do a market analysis and predict prices in the market.
So, do not get enough experience to trade in the real forex market.
For that reason, he advises trading manually and learning to predict the existing market and open positions based on in-depth analysis.
“The experience gained when trading manually cannot be replaced with trading that is done automatically,” he told CNNIndonesia.com, Tuesday (7/9).
In addition, another thing to note is that trading robots cannot adjust to market fluctuations. This is different from manual trading, which knows news updates and market fundamentals.
Dikki also warned about disturbances, such as lag and freeze (errors) which have the potential to be detrimental. “This is because the trading process cannot be carried out optimally either through a pair or not through a pair. So make sure to pay attention to it,” he explained.
He reminded Bappebti that it has blocked several domains that offer forex trading system robots that do not have a license from Bappebti. According to him, this should be a concern for traders.
Money Market Analyst Ariston Tjendra describes at least four things to consider before choosing a trading robot.
Ariston said you should check the robot’s performance at least in the last 1-3 years, whether it makes a profit or even stagnates. Then, what is the percentage of the loss compared to the capital/deposit?
Check the equity curve.
Find out if it is stable up or too volatile up and down. “If it is too volatile, it means that the risk level is high,” he added.
Check the risk to reward ratio.
If the risk is below the reward or profit, he said in the long term the robot’s performance is potentially good.
Check the maximum amount of drawdown or maximum decrease in equity/deposit.
This can help the need for a deposit amount in using the related robot.
“On the other hand, this can also show the level of risk using this robot. The bigger the drawdown, the higher the risk,” said Ariston.
One of the most important things in choosing a trading robot, continued Ariston, is that the service gives investors or traders the control to stop using the robot if it doesn’t meet expectations anymore.