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Forex Auto Traders: A Scam or A Gold Mine
Automated Forex trading, also known as auto Forex trading, is the process in which you allow a computer program to either trade your Forex account or recommend trades which you may then execute manually.
The computer program executing or recommending trades will operate according to a set of rules which will govern the generation of trade entries and trade exits.
Implementing automated Forex trading can be done by either building your own computer program, buying one, or even obtaining one for free, and then attaching the program to your trading platform. Many Forex trading platforms, especially MetaTrader 4 and MetaTrader 5, are designed to accept such programs easily.
The main advantages of auto Forex trading are that it can remove emotional and human factors from your trading, and also that it can execute trades 24 hours per day and free the trader from the need to be sitting in front of a computer terminal.
The main disadvantages of automated Forex trading are firstly, that if there is any bug in the software, it can make a huge amount of unnecessary or poor trades very quickly and blow your entire account. Secondly, if you buy a program whose rules are secret, and you entrust it with your account and leave it running, you may return later to find very unexpected results. This is why it is very, very important to back test thoroughly any auto Forex trading program or “robot” before attaching it to a trading platform on which you are running a live, “real money” Forex trading account.
How Do Forex Automated Systems Work?
If you are going to trade Forex, sooner or later you will hear about automated Forex trading systems. They are also called “robots”, “expert advisors”, and “auto traders”. No matter what you call them, they all operate in a similar manner. While the exact technical set ups will vary from system to system, the operation of them will essentially be the same.
You will download and install the system to your Forex trading platform and set up should only be a couple of steps. The basic premise of these things is that they are essentially an “add on” to your trading platform. This allows for easy installation, and uninstalling is just as simple. Because of this, many traders will actually have several different systems that they use in a variety of market environments.
The systems will fall into two basic categories: automatic and semi-automatic. The automatic ones will place trades for you, without any input from you at all. The semi-automatic ones will simply give you a signal or suggestion as to which way to trade a particular currency pair, and you may then place the trade yourself.
The automatic systems will simply buy or sell based upon a possibly complex mathematical formula that tells the computer when it is time to enter or exit the trade. The automated Forex brokers system simply does all of the work for you. It is very common for these systems to have a hidden proprietary algorithm that you never see in order to make these decisions. The one thing they will all have in common is that they are all mathematically based. Hiding the algorithm is just a simple way of protecting their intellectual property.
The auto Forex trading system type offered by Forex automated traders will simply let you know when it generates a signal to buy or sell. The system will still have that hidden algorithm that you won’t see, but instead of it automatically placing the trade on your behalf you will often see some kind of pop up alert when it is time to trade. You can then choose as to whether or not you want to trade the signal, allowing greater flexibility for the trader.
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The majority of these systems are made for the MetaTrader 4 platform as it is by far the most popular one out there. There are systems made for other platforms such as DealBook 360, NinjaTrader, TradeStation, and many others. However, you will find a huge supply of them for the MetaTrader 4 platform as even the brokers that use other platforms will often offer MetaTrader 4 as well. There is also a large amount available for the MetaTrader 5 platform, which is not always compatible with MetaTrader 4.
The better Forex automated trading systems will come with a money back guarantee. Because of this you should be able to feel somewhat comfortable with the software as your money can be refunded. However, it is recommended that you try a new system out on a demo account just to make sure it performs to your required standard. Like anything else, there will be some that are better than others and your mileage may vary so to speak.
Forex Auto Traders: A Scam or a Gold Mine?
The rapid speed at which the Forex market is growing has many consequences, some better than others. On the one hand, there are endless resources online for learning and becoming an expert on the largest most lucrative market in the world. There are also many more people around the world who are spending their days and nights testing the waters of Forex trading.
Other positive outcomes of Forex growth are more Forex brokers and services from which a trader can choose. On the other hand, the great popularity of Forex brings with it some problems that require caution on the part of the Forex trader. One of the biggest issues in today’s online Forex community, as well as the general Web community, is spam. When it comes to surfing the web and encountering annoying popups or receiving bogus emails, as annoying as these occurrences are, 99% of the time, they are annoying and nothing more. Of course, there is the occasional online scam, but with the widespread use of online communication such as email, messenger, and social media, most people know to stay away from those types of things.
When it comes to Forex spam, however, it is a totally different ball game. There is money to be lost as a result of the different types of Forex spam that traders encounter on a daily basis. The most common type of Forex spam is advertisements for Forex robots or auto forex trading systems. The big question regarding these auto traders is “Are they all bad? Are there some legitimate ones and are they worth trying”? The answer is that they are NOT all spam and that there is a LOT of money to be made by using auto traders, but for that, you need to do your homework.
An Introduction to Auto Traders
First, let’s try to understand why one would use an auto trader and what are its advantages. As, we said earlier, one of the biggest downfalls of the Forex trader is emotion. While being in touch with your emotion will get you far in life, it will set you back in your Forex trading. It is important to set yourself a trading strategy and stick to it, NO MATTER WHAT. This is harder than it sounds. Just imagine you define your trading technique, and for days, all you see are losses. Could you control yourself and not become overly emotional at this result?
Alternatively, if you are seeing constant profits, would you not be swayed by greed to trade with too high a risk? It would only be human. Precisely for this reason, it can be a smart tactic to remove the human factor from your trading. The way to do this is to automate your trades.
There are many auto traders out there that perform technical analysis and decide when to open or close trades, while its primary “concern” is to keep you on the winning side. Unlike Forex brokers who occasionally profit from your loss, auto traders work for you and not against you. This could of course be a reason to be wary of Forex auto trader which you see promoted by Forex brokers! Another reason to use auto traders is that they can trade 24 hours a day, even when you are not near your computer.
Imagine, you can be at a friend’s party and find out that you just made a huge profit, it’s like the feeling you get when finding money in your pocket multiplied by 100. Let the auto trader do all the work while you sit back and enjoy the fruits.
Finally, auto traders can be a great and effective trading tool for any Forex trader, no matter how experienced they are. However, it offers a huge advantage to new traders. They do not need to know the market, how to read the charts, or what a certain currency will do in the market today. Essentially, you do not need to know anything about the Forex market, and you can become a very successful Forex trader.
Choosing an Auto Trader
Now that we have established that Forex auto traders can be a wonderful thing for traders, how do you choose one?
There is no one way to decide which auto trader to use. An important and crucial tip in ensuring your auto trader is legitimate and will bring you profits and not losses, is of course to read reviews. You can read professional reviews as well as user reviews, but make sure these are objective opinions and not written by the people who are behind the system that is being reviewed.
Before entrusting your money to an auto trader, you should back test the auto trading program against many years of real historical Forex data, ideally over 20 years. Then you can see how badly it would have done in a “worst case” scenario. A good risk manager would plan to encounter another scenario which would be twice as bad. So, for example, if your back test shows that the auto trader lost as much as 30% at some point over the last 20 years, you should plan for a worst-case scenario of a 60% loss in the future. Of course, you should be able to adjust the risk by playing with the position sizing element of the auto trader to ensure that the risk is adjusted to the worst drawdown you are prepared to sit through.
Another way to take precautions before buying a Forex auto trader is to look for a few signs when examining the company at hand. Here are a few questions you should ask yourself when choosing a Forex auto trader:
- Do they offer a money back guarantee?
Most reputable auto traders are so confident that their product works, they will offer a money back guarantee ranging anywhere from 30-60 days after the purchase. This means if you buy the software and realize soon after, it is not for you, you can receive a complete refund. This is a must when choosing a Forex auto trader. If you have this guarantee, it lowers the risk of a scam to virtually zero.
- Do they offer a free demo?
Similar to choosing a Forex broker, one of the first things you need to do when choosing an auto trader is test it out. When buying a car, would you not test drive it first? Make sure to do the same in your Forex trading. Test out the software before purchasing it. However, it is also important to take into account that demo accounts are not always 100% accurate, so take the results of the demo with a grain of salt.
- Does their website annoy you?
Lastly, this is a universal rule when it comes to buying anything online. Go to the vendor’s site and look out for any popups/illegal activity/inappropriate advertisements. This is not always the case, but it is a precaution worth taking. 9 out of 10 times, a site that displays annoying and shady popups will offer a questionable service as well. If this vendor associates itself with shady businesses or the online pornography industry, you should think twice before investing your money in such a company. As I said, this is not across the board, there are some very legitimate online businesses that feel that a popup covering your entire monitor is effective marketing. They are wrong, but that does not make them a scam.
The bottom line is that online scammers choose to scam in areas that are full of potential. Nobody is going to click on a spam advertisement for a computer from 1981, scammers know what they are doing, and they choose topics that will draw attention. Forex auto trading has endless potential when it comes to making you significant profits, but just like anything else online, you must proceed with caution
Adam Lemon began his role at DailyForex in 2020 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy
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|Брокер||Контактное лицо||Эл.почта / Skype||Веб-сайт|
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As a trading technology leader, TradeStation supports casual traders through its web-based platform and active traders through its award-winning desktop platform, all with $0 stock and ETF trades.
Top Takeaways for 2020
After spending five months testing 15 of the best online brokers for our 10th Annual Review, here are our top findings on TradeStation:
- Our testing found TradeStation to be a leader in trader technology, with one of the most robust desktop platforms available we’ve ever seen. No question, TradeStation is a winner for Futures Trading, Options Trading, Mobile Trading, alongside specialties such as Day Trading and Professional Trading.
- TradeStation offers great tools through a platform suite that includes desktop, web-based, and mobile variations. All three are terrific. Top that off with $0 trading through TS Select and TS Go accounts, and there is a lot to like.
- Like its other active-trader focused competitors, TradeStation lacks in its offering of fundamental company research for casual investors. Education is also a mixed bag, making it just an “ok” choice for beginners.
|Commissions & Fees||4.5 Stars|
|Offering of Investments||4.5 Stars|
|Platforms & Tools||5 Stars|
|Mobile Trading||4.5 Stars|
|Customer Service||4 Stars|
|Ease of Use||4 Stars|
Commissions & Fees
TradeStation offers a variety of different commission structures, which can be confusing. Fortunately, TradeStation’s most commonly used pricing plans, TS Select and TS Go, offer $0 trades, are easy to understand, include free market data, and incur no monthly platform charges.
TS Select: TradeStation’s most commonly used pricing structure requires a $2,000 minimum deposit and includes access to all three TradeStation platforms. With TS Select, all stock trades (including ETFs) are $0, options trades run $.60 per contract, and futures are $1.50 per contract (per side).
TS Go: With no minimum deposit required, TS Go offers unlimited $0 stock and ETF trades alongside options trades for just $.50 per contract and futures trades for $0.85 per contract (per side). The one limitation to using TS Go is that while all three platforms are available, any trades placed with TradeStation desktop incur a $10 fee.
Penny stocks: Under TS Select and TS Go, penny stock trades are $0 for the first 10,000 shares and $0.001 per share after that.
Other pricing plans: $0 trades aside, TradeStation offers two different commission structures to select from for professional traders: per share and unbundled. For a full pricing breakdown, see our detailed TradeStation commissions notes.
TradeStation Salutes: Also, unique to TradeStation, active military personnel, veterans, and first responders can sign up for the TradeStation Salutes program, which provides 100% free stocks, ETFs, and options trades.
TradeStation pricing summary:
|Stock Trade Fee (per trade)||$0.00|
|ETF Trade Fee||$0.00|
|Options Base Fee||$0.00|
|Options Per Contract Fee||$0.50|
|Mutual Fund Trade Fee||$14.95|
|Broker Assisted Trades Fee||$50.00|
Platforms & Tools
TradeStation offers two trading platforms: TradeStation desktop, which is the company’s flagship product, and Web Trading, which is a browser-based platform designed for traders seeking simplicity. Both are excellent.
TradeStation desktop tools: The functionality provided in the TradeStation desktop platform is rich with depth and widespread. Tools in the TradeStation arsenal include Radar Screen (real-time streaming watch lists with 329 customizable columns), Scanner (custom screening), Matrix (ladder trading), and Walk-Forward Optimizer (advanced strategy testing), among others. Using TradeStation’s proprietary coding language, EasyLanguage, traders can even code apps for the platform and make them available in TradeStation’s TradingApp Store.
TradeStation desktop charting: More than 40 years of historical data are viewable for stock charts. Furthermore, a staggering 274 indicators/studies are available, each of which can be reworked or adjusted to the trader’s specifications using EasyLanguage. Pros aside, I did uncover two minor flaws with charting. The first is that there is no way to plot basic y-axis markers for corporate events such as dividends, splits, and earnings. Second, there is a lack of automated technical analysis.
TradeStation Web Trading: TradeStation Web Trading is easy to use and provides traders a way to manage active positions, open orders, watch lists, conduct stock chart analysis, and place trades with ease (ladder trading via Matrix included). The chart-trading functionality alone is superior to many flagship platforms. Note: With TradeStation Web Trading, watch lists do not sync with TradeStation desktop, which is a bit annoying for traders who use both platforms.
Options trading: Options trading is a breeze using OptionStation Pro, a built-in tool within the TradeStation desktop platform designed for streamlined trading and robust analysis. Options tool capabilities include custom grouping for current positions, streaming real-time greeks, and advanced position analysis, to name a few.
Futures trading: Like options trading, futures traders will also find themselves right at home with TradeStation desktop. Many of the advanced tools used for trading equities apply to futures trading, creating a seamless trading experience.
Like its close competitors, TradeStation is not built for performing in-depth company research. Pros include full stocks and options screening, equity backtesting, as well as streaming futures and forex data. Cons include no traditional fundamental research for stocks, no mutual fund or fixed income research, and a nearly non-existent ETFs research experience.
To score Customer Service, StockBrokers.com partners with customer experience research group Confero to conduct phone tests from locations throughout the United States. For our 2020 Broker Review, 280 customer service tests were conducted over ten weeks.
- Average Connection Time: th (14 brokers)
TradeStation’s mobile app is meticulously designed and provides the functionality active and professional traders alike need to succeed. Full day trading functionality is incorporated, thanks to Matrix (ladder trading) and complex options trading support. Note: Matrix requires Level II market data, which is available for an additional $11 per month.
Charting: Charting on TradeStation mobile is robust, clean, and includes pretty much everything a demanding trader could want: full chart type and date range flexibility, after-hours visibility, active and filled order visibility, and 43 optional indicators, to name a few. Even drawing tools are available so you can draw anything from trend lines to Fibonacci retracements on charts, although I would recommend a large phone screen or iPad as my iPhone XS was too small.
Watch list syncing: While mobile watch lists automatically sync with the Web Trading platform, they do not sync with the TradeStation desktop platform.
FuturesPlus: For futures options traders specifically, TradeStation offers a standalone app (trading platform) called FuturesPlus. Designed in conjunction with Trading Technologies, FuturesPlus provides a variety of advanced tools one would expect from TradeStation. Highlights include price visualization, predefined and custom strategy builders, advanced contract analysis, real-time time and sales, and of course, risk management via Greeks.
Mobile app Gallery
Offering of Investments
TradeStation provides its customers access to a nearly complete offering of trading products. Full access to stock and options trading, including comprehensive direct-market routing, numerous advanced order types, and more.
Drawbacks: Besides a lack of international trading, the other downside to TradeStation’s offering is that all mutual funds orders must be phoned in.
Cash management: Rare in the online brokerage industry, any account cash sitting idle will earn customers interest of 0.55% annually (varies depending on the Fed Funds Rate). In TradeStation’s case, the one major catch is that a $500,000 minimum account balance is required for equities accounts, and $250,000 is required for futures accounts.
The future is bright for TradeStation in terms of trader education; however, as of early 2020, the broker is in the middle of a multi-year transition.
Good stuff: In 2020, TradeStation launched YouCanTrade, an independent education-focused website run separately from TradeStation brokerage. While still in its early days, the educational platform looks very promising. Traders can pay to gain access to full-featured courses, including webinars, live trading room access, real-time alerts, and more.
Bad stuff: Looking at TradeStation’s website learning center on its own, there is little to no educational content offered. For starters, TradeStation needs to create free learning paths (ideally article and video mixed) to teach the basics. Next, opening up YouCanTrade to current TradeStation customers would be beneficial. Bottom line: TradeStation customers deserve to have an excellent, free learning center foundation leveraging YouCanTrade technology to compete with other broker offerings.
Platform education: Traditional investor education aside, TradeStation provides thorough materials for new customers learning how to use the TradeStation desktop platform. Alongside numerous videos and help guides, advanced traders seeking personalized one on one training can pay $150 for one-hour private learning sessions.
With more than 30 years of experience under its belt, TradeStation is a market leader and innovator. The TradeStation desktop platform is top-notch, while mobile trading is also feature-rich. Even casual investors will be happy with the Web Trader platform, thanks to its focus on simplicity and ease of use.
The bottom line: Regardless of the asset class, TradeStation offers a winning solution for traders across all skill levels.
Headquartered in Plantation, Florida, TradeStation is a wholly owned subsidiary of Monex Group, Inc., one of Japan’s largest online financial services providers. (1). TradeStation’s roots date back to the 1982, when the company was formed under the name Omega Research. The company’s flagship TradeStation platform was launched in 1991, and TradeStation Group was a NASDAQ listed company from 1997 – 2020, until it was acquired by Monex Group (2).
2020 Review Methodology
For the StockBrokers.com tenth annual best online brokers review published in January 2020, a total of 3,540 data points were collected over six months and used to score brokers. This makes StockBrokers.com home to the largest independent database on the web covering the online broker industry.
Participation is required to be included. Each broker completed an in-depth data profile and provided executive time (live in person or over the web) for an annual update meeting. Our rigorous data validation process yields an error rate of less than .001% each year, providing site visitors quality data they can trust. Learn more about how we test.
Online Broker Reviews
StockBrokers.com reviews many of the online brokers available today for trading. Our online broker reviews assess brokers that offer stock trading, options trading, ETFs, mutual funds, IRAs, bonds, futures, and forex.
Our goal is to provide the most in-depth reviews so investors can find the best brokerage for their investing needs. Each year our team tests and assess these firms on over 236 variables which formulate their star ratings for various categories, as well as the scoring for the best online brokers 2020 review.
How We Test
Our mission at StockBrokers.com is to provide accurate and widespread data for every online broker we track. StockBrokers.com is home to the largest independent database on the web covering the US online brokerage industry. In our 2020 Review, we assessed each broker on 236 separate variables across eight core categories.
With this data, we are able to thoroughly evaluate each broker and provide StockBrokers.com visitors with accurate and easy to understand star ratings. Broker star ratings can also be compared side by side using the brokerage comparison tool.
Historical Broker Reviews
Over the years, online brokers come and go. Here is a list of brokerages that have been acquired and no longer operate as a standalone business: Capital One Investing (acquired by E*TRADE), MB Trading (acquired by Ally Invest) OptionsHouse (acquired by E*TRADE), optionsXpress (acquired by Charles Schwab), Scottrade (acquired by TD Ameritrade), thinkorswim (acquired by TD Ameritrade), TradeKing (acquired by Ally), tradeMONSTER (merged with OptionsHouse), Zecco (merged with TradeKing).
Advertiser Disclosure: StockBrokers.com helps investors across the globe by spending over 1,000 hours each year testing and researching online brokers. How do we make money? Our partners compensate us through paid advertising. While partners may pay to provide offers or be featured, e.g. exclusive offers, they cannot pay to alter our recommendations, advice, ratings, or any other content throughout the site. Furthermore, our content and research teams do not participate in any advertising planning nor are they permitted access to advertising campaign data. Here is a list of our partners.
Disclaimer: It is our organization’s primary mission to provide reviews, commentary, and analysis that are unbiased and objective. While StockBrokers.com has all data verified by industry participants, it can vary from time to time. Operating as an online business, this site may be compensated through third party advertisers. Our receipt of such compensation shall not be construed as an endorsement or recommendation by StockBrokers.com, nor shall it bias our reviews, analysis, and opinions. Please see our General Disclaimers for more information.
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