Creating an Automated Trading System for Trading Forex Currencies, Stocks, and Indices
Automated trading is a method of trading the global financial markets without human intervention. When we refer to automated trading, we refer to the way that trading orders are actually executed. An automated trading system must be able to execute trades without any human external intervention by placing also limit orders (usually a take-profit and a stop-loss).
Major Advantages of Automated Trading
ü The greatest advantage of automated trading is that it is able to minimize emotions throughout the trading process
ü An automated trading system never gets tired
ü Automated trading systems are also able to analyze multiple financial markets at the same time
ü Using a VPS hosting service, you can turn-off your PC and continue trading 24hours per day
ü Automated trading offers the ability to easily and quickly backtest any trading idea (backtest means test the historical performance of any trade strategy using historical data)
Minimum Configuration for Automated Trading
1. A suitable brokerage account
2. A personal computer or a VPS
3. Buying or creating a custom automated software (Expert Advisor)
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1. Forex & CFD broker accountS
For trading the Foreign Exchange market, you need a Forex broker. For trading stocks, indices, metals, or energy you need a CFD broker. Thankfully, today most brokers offer all financial instruments at the same account (Forex, Equities, Crypto, Commodities).
Finding the right Forex Broker is the important part for start using any automated trading system.
The right Forex broker for automated trading must be able to offer the following:
(a) Safety of money
(b) Fully acceptance of automated trading, EAs, and scalping
(c) Competitive pricing
(d) Fast order execution and low slippage on order execution
(e) Offering the platform MetaTrader-4 (the standard of auto-trading)
(f) A free VPS (not required but good for traders)
■ Find here a list of Forex brokers that meet all the above criteria at the website TradingCenter.org:
» https://TradingCenter.org/index.php/trade/forex/ecn-forex-brokers
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2. FINDING COMMERCIAL AUTOMATED TRADING SOFTWARE
You can buy commercial automated software in order to use it to auto-trading platforms such as MetaTrader4 or Tradestation. This type of software costs from $50 to $200, or even more, and needs only installing once.
■ More about Commercial Automated Trading Software at the dedicated website for auto-trading ForexRobots.net:
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3. Creating Automated TRADING SOFTWARE without any Programming Skills
For those who are lacking programming skills, there is an advanced online application that can provide a user-friendly interface for transforming ideas into fully automated trading strategies. The EA Builder is an application that can transform trading ideas into indicators or Expert Advisors (EAs). The system is 100% web-based and it is compatible with MT4, MT5, and TradeStation platforms.
EA Builder Basic Features (for MT4, MT5, or TradeStation)
Ø Completely free for creating indicators
Ø 100% Web-based App
Ø Full set of built-in functions (including even trendlines and time parameters)
Ø Full Money-Management system modules
Ø The outcome is a single compiled MQL4/MQL5 file, ready to trade
Ø 15 video tutorials
Ø Can be used on any PC, MAC, or Linux-based computer
■ More about how to build Custom Automated Trading Software at the website for auto-trading ForexAutomatic.com:
» https://ForexAutomatic.com/index.php/automated-trading/expert-advisors/expert-advisors-builder
The Advantages of this Method
1. Free for creating indicators (which can be later transformed into EAs)
2. No need for Programming Skills (graphical environment)
3. Can build automated strategies for trading all asset classes in any timeframe
4. Includes tens of functions and a wide variety of technical analysis indicators
5. Action alert methods (e-mail, audio alerts, on-screen)
6. Spread and slippage control (important for scalping strategies)
7. The final code can be used in unlimited accounts (no limits)