Traders prefer automated trading robots because they do not require additional skills or training. To use these forex trading robots, there is no experience needed because they work on a set algorithm. They claim to win trades and make profits on behalf of traders. However, the reality can be different. The robots can fail and cause immense losses for the traders.
Thus, experts advise that whenever one invests in a trading robot, it should be first tested. Robots tend to fail due to many reasons, but the primary reason is often that they are fake and scams. There are many providers who claim and ‘guarantee’ profits through robots. Traders should be aware that forex is an uncertain market where nothing can be guaranteed. Thus, if some robot guarantees win all the time, it can be a fake one.
Thus, traders have to identify fake ones and stay away from them. Here are some of the many ways traders can identify fake ones which can cause the loss.
Signs of scam you need to look out for
The seller’s website mostly contains information about forex EA. In case it is a scam, you can look out for these red flags:
Undiversified strategies of scalping
Some robots have a definite scalping system related to them. It generally means that for those robots, the overall profit rate is very small. There is often a high win rate in this case with inflates in the marketing condition. You can’t forget that the Forex markets are extremely volatile, and the market conditions can change anytime. If the change happens, the system tends to lose more than it wins from the trade. Further, it takes only a few losing trades to wipe out your profit completely.
Unrealistic marketing messages
There are often marketing messages posted by the forex robot author about how it is like a dream come true for every trader to solve their issues. The actual reality to it is that most of the time, these are a scam! Try not to believe only in words and always go for actual test results. You need to remember that no robot can guarantee 100% success; thereby, choose wisely before investing.
Looking for verified results
You should always look for a verified test result before believing in the statistics. A simple tip, look at the top right corner to identify whether the result is verified or not.
Extremely high growth returns
Some sellers’ market the Forex robots by saying that it yields a huge return of 4000% every year. This news might seem wonderful, but you need to analyse the statistics before believing it properly. These might result from the closing trades, and the open trades might be on the losing end.
Last updated
Look for charts that have been updated recently. The date and time verification can be from a few hours to days. But, if it was updated several months ago, you need not rely on it.
Private results
When checking the accounts, look at whether it is kept private or not. If it is kept private, there are chances of it being a scam. Remember, a genuine account doesn’t need to hide anything from the buyer.
Keep in mind these factors mentioned above to avoid any forex robot scams. Normally, best forex EA’s provide transparency on their Myfxbook accounts and official websites.