One of the most popular ways of trading is by following
"signals". If you've ever heard the term "Forex Signals"
but wanted to know more about its pros and cons, and whether it is suitable for
you or not, this article is for you.
What is a signal service?
A Signal Service provides alerts on trading opportunities.
For example, a professional trader sits at his desk, trading his account (or
his company or hedge fund account). Whenever the trader enters the market, he
also sends an alert to his subscribers, giving them the opportunity to enter
the same trades as him. Some service also provide an automated robot, sometimes
called a Trade Copier or a Trade Cloner. This robot will execute the same trade
on the client's account, so clients don't need to actually go to their computer
and execute the signals manually. Such service is "Vladimir's Forex
Signals & Mentoring".
Why should I use a signal service?
Whether you a new or experienced trader, there are signal
services out there that will contribute to your profits or set you on the right
track to trading success.
For beginners: trading alone can be confusing and difficult.
Like any other profession, you will not see success over night (despite what
some brokers might try to lure you into believing…) So, on your first steps in
this exciting but dangerous world, services such as Vladimir's Forex Signals
& Mentoring, can take you hand in hand to learn the way real professionals
trade. Plus, you have a chance to copy the trades of a pro into your own
account, so you start trading on the right foot.
A signal service is also suitable for people who do not have
the time to sit all day in front of the computer, looking for trades. Being
subscribed to a signal service means there's a pro trader sitting and looking
for trades on your behalf. Saves a lot of time and headaches, plus of course
the results should be better, as you're having a highly experienced
professional working for you.
For veteran traders: it's a real opportunity to hone your
skills, and provide an additional source of profitable trades to diversify your
"portfolio" of strategies. It is also an opportunity to join a
community of like minded traders who communicate (through chat and live trading
rooms) during the trading day, and help each other achieve better results.
What are the disadvantages and problems with signal
services?
Here are the disadvantages and common issues with signal
services, which require your attention and caution:
Hidden agendas: some brokers provide free signals. You've
got to ask yourself why would someone offer free signals if they are serious
and profitable. The answer in most cases is that they have a hidden motive – to
push you to trade more. The equation is simple: the more signals they send you,
the more trades you make, and the more commissions they earn. That's why their
main interested is sending as many signals as possible, not as good and
profitable signals as possible. These kinds of freebie signals have made a bad
name for the world of signals, but luckily there are a few rare paid signals
providers who do a good job.
Time constraints: many signal services require you to be
near a computer most of the day, so you can immediately enter the market
whenever you get a signal. However, this issue has been overcome by using
what's called a "Trade Copier", which is an automated robot that
receives its trading commands directly from the signals service trader.
Good signals come from good traders: Unfortunately, the
Forex industry is full of scams and dishonest vendors. Calling yourself a
trader and providing signals is easy, but providing signals which actually
provide profits is of course a different story. The statistics are that 95% of
traders lose money in Forex. This applies to signal providers as well. So, your
mission is to find one of those 5% of signal providers who actually make money
in Forex.
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