Wednesday, August 21, 2013

Grey box Foreign Exchange trading

The Internet is, truly, the great leveller for traders. There was a time when it could have taken years for a technology or technique that was in use by the professionals to be made available to the gifted retail investor or trader.

Not any more. For a while now it has been apparent to large hedge funds and Forex dealing institutions that the holy grail of a Forex trading robot, which could be uploaded into a computer and allowed to operate unsupervised, making profits while the owners were away doing something else, was a dangerous delusion. The reason for this is the total confusion and disorder that exists in the Forex markets from time to time. Robots can be a recipe for disaster.

Not ones to stand still, the big players moved on, as they always do, and discovered that Algorithmic trading does have an important part to play, but as an assistant to the discretionary trading that well trained humans can be so good at, rather than as a trading robot.

Now this technology is available to those outside of the institutions and hedge funds, who nevertheless make up a large part of the Forex trading community.

Just watch out for the disreputable operators who will try to tell you that you can make money from an unattended “robot” or EA (Expert Advisor). To succeed you do need to be informed and you do need to use your algorithmic tools in a directed, sensible fashion in order to have sustained success.

No comments:

Post a Comment