I've used more than my fair share of EAs and robots, over the past 4 years. Some of these were custom built for me.
The idea of not having to watch the screen all day is so alluring, until things start to go wrong. If using an MT4 broker ("the enemy"), you'll be faced with fairly regular "trade context busy" errors plus a few others. The enemy knows that you are using a robot and will do everything in their power to screw you and reduce your account balance to zero.
I have binned every one of my EAs and now trade manually. At least, I can sleep knowing that the now redundant robot, that was making my trades, isn't going to get f*cked over, at 2 a.m. by one of the criminals out there, masquerading as an ethical broker
ditto here.
i had my fair share of screw ups by MT4 brokers too. Huge slippage on market orders. There is also another **hidden** problem; which is limit orders. If you trade using limit orders; you get much bigger screw up compared to market orders.
How did I knew this?
after experiencing similar issues as you mentioned above; i wrote my own java app that connects to Interactive Brokers. I then replicated my trades from the MT4 EA directly to IB; whilest still trading on MT4. Even though there was latency between MT4 and IB (in favour of MT4); the exection on IB was much superior. This is because the order has to go to MT4 server and get accepted first; before it get copied to IB
I noticed market orders has noticeable slippage; sometimes bigger than my profit on the position. I also noticed the problems associated with limit orders. Many of my limit orders did execute on time in IB; but never to execute on MT4. I also observed the opposite on stop orders. MT4 seems to execute some stop orders; while IB did not; as the market did not reach there!!!
i then did a research on MT4 brokers; unfortunately all these guys are making the market with your orders. Hence; the conflict of interest. You broker makes money from adding few pips to all of your orders; and also make money when you lose.
Many of these brokers do not hedge your orders on the market. In other words; your orders do not make it to the trading venues (aka Interbank Markets). the MT4 broker keeps them in their safe; and wait for you to lose that position; and cash in the profit.
Even if they do act like a good boy; and send your orders to market...etc. They are on the other side of your trade. I have a problem with that. It is a trust problem. they can abuse it anytime. They may not have so far; but boy; they may. if you can live with that.
If the broker was my wife; i will perhaps trust them; because I can see them every day and night. With a broker; how do you know if they are abusing the trust.
Say you are a fruits and vegies trader in the market. The traditional way of doing your business; is to buy vegies from the wholesale market and sell them on the retail market; kilo by kilo.
If you want to stay home; and hire Mr. B to do this for you; there are two options:
1- Mr B will buy you the vegies from wholesale market; and sell them on the retail makets; and give you the P/L for a free. Total transactions used here is 2 (This is the traditional brokerage business)
2- Mr B will buy the vegies from the wholesale market; using your money, then sell the vegies to you at different price; pocketing a profit. Then Mr. B will buy the vegies from you; using your own money; and sell them on the retail market pocketing another profit. He will decide how much you get of profit; and pass you the pennies. Total transactions used here is 4 (this is MT4 brokers)
do you see a problem with (2) above? how do you know if Mr. B screw you or not. You don't have to!!!! if he is trading with you in and out; he is looking after himself. He may leave some pennies profit to you once in a while; so you don't find out and fire him. He wanted you to remain in your home playing guitar hero while he takes care of your vegies. He does not want you to get near the vegies market at all; otherwise you will find out he is screwing you. Do you think the quotes you see on your MT4 are real quotes? I invite you to find out for youself. search "MT4 Dealing Server" if you are in doubt.
The bottom line is; look for brokers who act like (1) above; and avoid luls in (2)
PS: However; i do give credit to MT4 software for being cool. I am still using it for many things BUT live trading; such as:
- monitoring the market;
- Using it as chart platform for my java app
