Building Automated Trading Strategies October 2018 | Page 50

➢ Risk management is a very important issue for the long-term success
of every automated-trading system
➢ Many professional traders follow the 2% rule and that means no
trading position should be worth more than 2% of a portfolio
➢ Enjoy growing a small account, and if this account makes good money
then withdraw 2/3 of your profits into your bank account and leave
your initial capital plus 1/3 of the profits
When Buying Commercial Expert Advisors (EAs) or other
Automated Trading Systems
➢ Make sure your Forex/CFD broker fully accepts automated trading and
scalping (avoid stealth mode techniques)
➢ ECN/STP accounts provide the best conditions for automated trading
(avoid Dealing-Desks)
➢ Make sure that the automated system you plan to use is compatible
with your trading style, and especially with your risk profile
➢ Focus on Winning Pips and not on Winning Ratio
➢ The desired Risk/Reward ratio of your Expert Advisor must be above
1:1
➢ Focus on the maximum drawdown in order to assess the downside risk
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