So you’re considering buying an automated Forex trading system, but you want to be very sure that you’re investing in a system that is going to give you safe, consistent and lasting trading profits, right?
The last thing you’ll want is to lose your hard earned money to a scam, but how do you differentiate between legitimate and fake Forex EAs when there are so many out there?
As a Professional Systems Developer, I’ve tested my fair share of Automated Forex Trading Systems. Based on my experience, I’ve discovered that there are 3 sure signs of a scam:
The promise of totally unrealistic returns
Most scams trap traders with the promise of totally unrealistic returns. You’ve read the sales letters selling the dream of doubling your account every few days, or turning $1,000 to $10,000 in 30 days. It works because it plays on one of our fundamental human weaknesses: greed.
The truth is that even if the automated Forex trading system in question can really double your money, it does so with a very high risk of blowing out your trading account, and the chances of you repeatedly doubling your money is at best on par with your nearest casino. Expect to experience a complete wipeout sooner rather than later.
Backtest results that show very few or no losses
Most people hate losing, and scammers know this all too well. They take advantage of this by playing on every traders fantasy: an Automated Forex Trading Systems that cannot lose. It’s easy to fabricate backtest results, because you can tailor the system to fit the data that you already know.
The problem comes when you try to apply such a system to reality. Live price action is very unforgiving towards ‘curve-fitted’, over-optimized automated Forex trading systems. If you really want to know if an EA works, a live demo test is essential. Which brings us to the third sign…
No money back guarantee
If the automated Forex trading system is not sold through a reputable vendor like Clickbank with the mandatory 60 day money back guarantee, forget it. It’s simply not worth the risk, regardless of how attractive it may look.
The 60 day money back guarantee is very important because it gives you the opportunity to do your own live system testing and validate the results for yourself. Also, I would never test any EA with real funds that I haven’t personally validated with demo account trading first.
Remember, if the automated Forex trading system you are considering does not pass any one of these three criteria, don’t take the risk. Capital preservation comes before profits, always.