What are Expert Advisors?

Expert Advisors (EAs) – also called “Trading Robots” – are software programs that are used to automate analytical and trading processes. They allow us to perform fast and highly technical analysis of price data and manage trading activities based on signals received. The entire routine work of technical analysis and trading can be given to expert advisors. An expert advisor can perform analytical and trading operations for any symbols or periods, independent of whether the corresponding chart was opened or not.

Advantages of Expert Advisors

• Time - Being a full-time trader requires a lot of time and patience. EAs allow you to carry out trades without manual intervention. This can free up your schedule and you can dedicate more time to other important parts of trading, like maintaining a trading journal.
• Emotions – Because EAs are data-driven and only follow set rules, traders who are prone to letting their emotions dictate trade decisions can find automated EAs to be a valuable tool.
• Diversification - Some traders who trade manually might decide to use expert advisors to diversify their strategy. For example, a long-term trader exclusively trading indices may investigate short-term EA strategies that trade currencies.

Disadvantage of Expert Advisors

• Glitches - Even if you have a broker with a reliable platform, a problem with an EA could occur and potentially lead to undesired trades. If you have not developed the EA yourself or do not have the skills to fix it, it is important to have the support you can reach out to. Remember, brokers rarely offer EAs themselves - it will be an independent, third-party developer who puts them on the market.
• Strict rules - EAs follow rules and cannot recognize a change in market sentiment or how a news release could affect the market.
• Due diligence - There are plenty of EAs available on the market. Some work well, some work less well. As a trader, you should not blindly trust an EA, and even if the strategy is profitable in the beginning, there is no guarantee it will run profitably for a prolonged period.