Can You Trade Automated Trading Systems Successfully ?

I have always thought that the way automated trading systems are portrayed to the general public is absolutely wrong. You buy a system that works, you plug it in, you see the profits roll in. Truth be told, nothing could be so far away from the truth. Although I go into much greater depth about this topic on my ebook, I wanted to write a post today about what I think are the necessary characteristics a person needs to succeed in the world of forex automated trading and automated trading in general.

To start I wanted to tell you something you will probably find very contradictory : Not everyone can be successful in automated trading. Of course, you may think I am totally wrong because you just need a profitable system, a person to plug it in and then the system does all the work, right ? Well, it is definitely not that simple. First of all, automated trading is not free from psychological effects as it is usually portrayed by most EA sellers (more on this within my ebook) and second, a person not only needs to have a profitable trading system, the person needs to know it is profitable and the person needs to be able to trade it. As I have said before many times, the market protects itself from everyone making profit from automated trading by making long term profitable automated systems extremely hard to trade, as the turtle trading systems, most people would never trade the long term profitable systems even if they were given to them for free.

So what characteristics does a person need to succeed in automated trading ? From my experience and the characteristics I have seen on the people who have managed to trade these systems consistently, I could tell you at least the things they have in common :

  • They are willing to learn. This means that they are able to grasp new concepts, take in and find new knowledge.
  • They are willing to accept reality. They are all glad to forget the unrealistic profit targets offered by most EA sellers out there and make peace with what is realistically achievable with automated trading solutions. The more you cling to the huge (50,100 even 1000%) monthly returns offered by EA sellers the more time it will take you to be profitable with automated trading.
  • They do the work. These people are looking to become dedicated to automated trading, they are not looking for a “set and forget ATM” or some other get rich quick scheme. These people take automated trading as if it was a job.
  • They are not stubborn. This is a very bad quality, specially because most stubborn people end up paying for their unwillingness to learn by losing large amounts of equity. They are too ways to learn, listen to the people who know or learn it the hard way, sadly most people have to learn things the hard way and few of them survive it.
  • They do not have huge egos. I have found that people who feel that a 3 month losing period makes them feel like failures tend to fail in automated trading. People who are able to accept that loses are common and necessary in trading always have the fastest way towards profitable automated trading.
Being stubborn and having a huge ego is definitely the worst combination since these people (as I have seen) are usually very attached to unrealistic profit targets and are always in the quest for a holy grail. Sadly, these people often lose the largest amounts of money and many of them end up quitting when they realize that what they had been searching for was just a mirage in the middle of the desert.

I think that these are the main characteristics I can think of right now. Make sure you leave any other ones you can think of on the comments. If you would like to learn more about why it is so hard to profit with automated trading systems and how it can be done and realistic profit and draw down targets can be achieved please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !
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