Expert Advisors (EAs) are automated programs that run on the MetaTrader 4 (MT4) or MetaTrader 5 (MT5) trading platforms. They are algorithms that can be used to monitor and trade the financial markets. Based on the parameters you choose, EAs can search for and identify potential trades and send notifications. They can also open and close a position based on predetermined conditions such as stops or trailing stops. EAs are ideal for monitoring the markets on your behalf and informing you of potential trading opportunities. They can also manage multiple positions daily without any need for human intervention.
EAs can be used to trade any market through MT4, although they are commonly used by forex traders.
How do Expert Advisors work?
EAs allow traders to discover opportunities and open and close positions based on predefined rules such as yes/no rules. Traders can build an EA using a programming language called MQL4 or import a ready-made one. The combination of rules into a mathematical model enables EAs to execute complex trading strategies and act on them. For example, a simple EA could monitor a market and send the trader a notification when certain set conditions regarding a potential trade have been met.
For example, if you’re interested in a particular currency pair, your EA can be programmed to monitor it and notify you when the currency pair reaches a specified level. You can also program the EA to act upon the opportunity as well as perform other actions depending on how complicated your EA is.
Advantages of Expert Advisors
The quick answer would be time. An automated system like an EA saves traders time and is ideal for emotionless trading as it performs actions without emotion. Flexibility, backtesting, and accessibility are a few more reasons for EAs’ appeal. While they are important benefits of any automated trading system, EAs could pose some challenges.
Disadvantages of Expert Advisors
- Buy a good one. Well, many could praise the benefits of an EA, but automated trading is not a simple recipe for success. Like anything else, the human factor is essential, plus a robot could not possibly reach the greatness of the world’s best fund managers. If you are going with an EA, then make sure you are getting what you are paying for. Do your own research and find out how much it costs to get a decent one.
- Human element. Your EA may be complex enough to perform certain actions, but this doesn’t mean it is faultless or can compare to a human-thinking trader! For this reason, please remember that your EA might help you limit the emotional impact on your trading but removing it completely may create new issues. Always monitor your EA and evaluate its performance according to your own plan and logic.
- VPS Hosting. If you want your EA to run all the time, then you need your computer and MT4 platform to be running and connected to the internet too. For this, you’ll need a virtual private server (VPS). VPS hosting basically hosts an online version of your MT4 on an external server which will allow your EAs to operate even when your home computer or mobile device is turned off.
- Finding an EA: MetaTrader Market. The MetaTrader Market has the biggest selection of paid and free Expert Advisors for MT4 and MT5. You can find indicators, as well as trading and financial magazines and books. You can search the market by category. You can buy or rent products and each product can be activated on at least four devices. You can also test them on demo versions before you buy them.
While you may choose an EA based on price or whether it can be rented or not, it is good to take your time and carefully review all the EAs listed on the MT4 market. Many EAs may be promising, but when they get tested, they may not perform as expected. So, once you choose an EA to review, you can test it out by checking the parameters that need to be specified such as risk percentage, market orders, spreads, hedging, target profit and many more.
How to begin using an EA
You can either build your own EA or download one. Before you start using it, you will need to backtest the EA to ensure that it operates accordingly and how you want it to before you start trading and spending real money.
Building an Expert Advisor
Building an EA may take some time and research. An EA for MT4 can be created using a programming language called MetaQuotes Language (MQL). The MQL is an object-oriented high-level programming language. To be able to write your own automated trading system you will need to first understand how this works. You can study the guides which are available on the MQL site.
The MT4 has its own wizard which can also help you create a simple EA by visualising the code that is being written and allowing you to create strategies without having to learn the programming language.
Using a ready-made EA
If you have done your research and found an EA you want to use then you can copy it into the ‘experts’ folder on your computer, located on the ‘c:’ drive. After that, please launch MT4 and you will find your EA on the left-hand side, in the section titled “Expert Advisors.” Drag the EA onto a chart. Before taking the EA live, review the settings and make sure everything is as you, please.
Backtesting your Expert Advisor
If you click ‘view’ in the top navigation bar of your MT4, you will find the strategy tester with which you can backtest your EA. In the strategy tester, select the EA you want to run, and the market and timeframe you want to run it against, so you know everything is working properly.
Since its launch in 2023, OnsaFX has increasingly captured trader attention worldwide, thanks to its strategic social media engagement and transparent service model.