What are risks with autotrading?

I am considering autotrading with one of CMS-fx's trading systems. Does anyone use autotrading, and if so, are there any additional risks using it vs. manual trading?

Where are the stops kept? On their server or your 'puter?
How does the algorithm handle disconnections? Can it reconnect automagically & not hang if open trade etc etc. . What happens if platform locks? Just a few of many questions. Always think of worse case scenarios.

I'd never consider autotrading. All this time and effort that I've put into it would be washed away. When I fly to Vegas for the Forex Expo, I'll trust the autopilot to get me there and back. But when I'm there, I want to be on the porch with the big dogs, not running free because my trading is being done for me.

As for the risk, if you are not behind the computer that generates your trades, then someone else is. If another human is involved in your trades, that's pretty risky.

Hi there - the CMS systems that you see in the software are not profitable systems per se. They are examples intended to illustrate how YOU can code a trading system.

To satisfy yourself on this you should open as many demo accounts as you can run on computers (I ran four) and run the various CMS trading systems. You will soon see how they work and you will soon see they are not profitable.

If you go to the VT Forum (that's CMS's Visual Trader software) you will in fact find posts relating to a test system a member wrote for back testing six of the trading systems. It is a lot of fun but not really very productive. The tests do not run back far enough and what tested to be the best performing Trading System, showing some profit actually ran at a loss when put to into practice.

The greatest weakness of CMS is that their trailing stops are NOT on their server but on YOUR PC. That makes the stop a pending order which can be very late being executed in a fast market. If you are trading live, real time, then trailing stops may not be important to you. They are also a little slow responding to orders but depending how you trade, this may not be important.

I like their software but you must be aware of its weaknesses.

Hope this helps.
M

I started a demo today using autotrade with one of CMS's trading systems. The trading system automatically entered a sell on the USD/JPY. I turned off my computer thinking that it would continue to buy/sell based on the trading system signals - boy was I wrong. After I turned my computer back on later, the USD/JPY pair increased and the trade was in the negative. I found out that once my computer is cut off, the trading system cuts off as well. I thought the system would continue to give buy/sell signals regardless if I
have my computer on or not. So, I found out from Dell if I could continue my internet connection even if I close the lid on my computer, and was told yes, through the hybernate function, which I am going to try out. As for a previous comment that their trading system signals are not profitable, I do not understand how this could be true, because if trades are entered according to the signals, which are very good, I do not see how you could lose money if trades are entered/exited according to the signals. I am going to continue to try this out - maybe I'll learn the hard way. I think another way for making this more profitable (and less risky) is to let the autotrade enter the trades for you, and afterwards stop the autotrade function and change your order to a market order and enter a stop. CMS does not guarantee trailing stops, so I do not want to use them. Does anyone know of an autotrade system that doesn't require a continuous internet connection? Any additional comments appreciated.

There are a few real autotrade systems around, some computer driven, some run by a team of human traders who will trade around the clock for you. Do a search on Google. There are also a few who simply do not advertise such.

One available, and it is FREE, is www.onedaytrades.com

They trade the EUR/USD and the premium You pay is 1 pip additional spread. Since this is at FXDD who only have a 2 pip spread, you are only paying industry standard 3 pips - it's free !

Problem - FXDD are, to be Very kind, slow. So far my account application has taken 12 days. Last Thursday, after I complained of their lack of speed, they promised it would be only another 24 hours. We are now 168 hours on.

I am not a very small player and maybe that is the problem.

BTW - the hybernate function STOPS the PC. It will not continue to trade. In windoze you can turn hibernate and standby OFF and close the lid.

basically the risks are with designing the autotrading, how well u take into account the myriad of variables and factors.

as for the action of autotrading, theres nothing wrong with it if you are profitable. i dont believe "running with the big dogs" or autotrading are suitable comparisons. the latter requires extensive researching, long hours of trial and error, and back to back testing, which at the end of work, results in success. as for using discretionary systems, most people, even professionals cannot escape from emotions. humans are fallible, we are at times irrational beings. what is rational is it only a response to a certain perception of reality orchestrated by the concesus herd of thought? okay im getting philo....point is, i dont see why its considered "risky", "not right", to be running a auto system while you sleep if its far successful and efficient than discretionary trading. not saying autotrading is the holy grail, its very close if done right.

You are 2 years late

ur right. these guys are probably dead by now.