How to Use Automated Forex Software to Build Profits
It's very easy to buy automated Forex software and set it up to run on your account. It is however, much harder to determine whether it is going to perform for you.
When you first buy an automated Forex software, try not to be too keen to set it running on your account. While many system providers offer historical results on the system's performance, this does not necessarily mean that the system will perform in your trading environment.
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The best approach is to set aside a small trading account for testing your systems. This doesn't have to be an expensive exercise if you make use of a mini Forex account and trade the smallest lot sizes. This will give you access to live spreads from your broker so you can be assured that the performance you see is accurate.
Alternatively you can set up a demo account. These are easily opened with a Forex broker in just a matter of minutes. This will provide you with a totally risk free way of trading the system. However you need to be aware that brokers will often offer better spreads on demo accounts than they will on their equivalent live accounts. For this reason you need to accept that if testing your system on a demo you may experience some small discrepancies in the results.
Once you have set your automated software you should then just leave it to trade. Don't panic if several days have passed and the robot hasn't traded. Some systems are designed to follow longer term trading strategies and will only make a handful of trades per month. Similarly, don't panic if you start to see some losses. Automated trading systems are no different from any other trading approach in that they will experience losing trades. What is important is how quickly the system recovers its losses gets back on track.
You need to evaluate the performance of the system for a number of weeks in order to understand how it works. This will then give you a reasonable set of results on which to base your assessment of the system.
After this time you can analyze the results achieved. You will then be in a better position to decide if the system is likely to work. You may at this stage want to tweak the performance depending on the results. For example you may notice a particular currency pair that does not perform or even a time of day when the system keeps losing.
Once you are happy with the changes you can then proceed in moving the automated Forex software to your live account. Even at this stage minimize your risks. Start by trading with the smallest lot sizes and only increase these if the system performs and more importantly, your confidence in the system grows.
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