Growth of the Robo-Advisor Market
Trading has significantly evolved over the years. One of the most
impactful developments in recent decades is the widespread use of EAs (Expert
Advisors). These are automated programs, developed by retail traders or large
companies to execute trades based on baked-in algorithms. These programs can
trade faster, and sometimes more efficiently, than a human trader, and are
relatively easy to develop, requiring no special programming skills.
As trading becomes increasingly more complex, the usage of these EAs
becomes more and more prevalent. The global robo-advisor market, according to independent research, grew from $6,36 billion
in 2023 — to more than $8 billion in 2024. By 2030, it is projected to reach
over $33 billion, having an annual growth rate of 26,71% (compounded).
This rise in the robo-advisors is having a huge effect on the global
forex market as well. In the U.S., daily market turnover reached $1,17 trillion
— partly attributed to the rise of EAs and algorithms usage. Rising volumes
indicate a more active trading environment, with trades being executed more and
more frequently.
Regular retail traders can take advantage of these developments as well
— using dedicated EA builders like StrategyQuant X, Forex Flex EA, and EA
Builder, among others, to level up a playing field with large institutions.
Some of the more experienced traders, having enough free time, prefer learning
MQL5 tools on their own, citing flexibility and better control as some of the
main reasons.
With recent rise in the AI, which enables an even easier time
programming any MQL5 bots, popularity and integration of EAs into trading
strategies is only bound to increase.
The Role of Expert Advisors
EAs operate on predefined algorithms. They can execute trades based on
technical signals, statistics, or machine learning algorithms; sometimes all
three are combined.
Many traders active with Defcofx seem to be plenty successful with
setting orders themselves, with their own hands, because they’ve been doing it
for years. Many others are having a hard time adding all the needed information
into the model, and prefer to keep it all inside their mind. However, it’s hard
to argue EAs have three distinct advantages that can make almost any forex
trading more profitable:
- Speed and accuracy. Using AI models, or even simple algorithms, expert advisors can analyze vastly more data than the human mind, and at a much faster rate. This is particularly good for most scalping strategies, where a decision needs to be made within minutes or seconds.
- Greater discipline. A properly programmed advisor will never stray from correct money-management techniques, and will never make an irrational, impulse-driven decision. EAs eliminate any emotional bias, and can ensure consistent strategy execution.
- Backtesting possibilities. You can check EAs on historical data, to see which orders they would have executed, and which strategies could’ve worked in hindsight. This is also a very powerful tool to refine strategies before deployment. This can precisely show, in advance, if your strategy has any merit to it. This, however, works only for rigorous strategies, and not for intuitive traders.
Why is Trading with Expert Advisors Becoming more Prevalent Now
The last few years have been the most important in terms of the rise of
popularity of robo-advisors, partly because of the advancements in AI. Chatbots
can develop basic EAs on their own, and machine learning can help spot hidden
patterns, making expert advisors more adaptive to different market conditions.
Strategies are becoming more robust and dynamic, and although some say this
makes trading less fun, others counter with “well, it makes it more
profitable”.
Global uncertainties, war, economic turmoil, and drastic news events,
make robots increasingly valuable in being able to react to price movements
with sufficient speed — taking full advantage of all these rapid changes, with
news cycles sometimes lasting minutes, instead of days or weeks, like it used
to be years before.
Some of the more popular scalping strategies, designed for quick and
small profits, rely entirely on EAs nowadays. They take advantage of low-spread
accounts like Defcofx
Gold to execute numerous trades, exploiting minor price movements.
There have been, however, trend-following and even swing-trading EA strategies,
that hold positions over several days or weeks. We have also noticed an uptick
in popularity of the grid-based strategies deployed on our VPS, virtual private
server. These place buy and sell orders at set intervals, creating a grid of
orders, and profiting from expected market volatility without the need to
predict a direction.
Scalping EAs, though, remain the most popular still. It might have
something to do with a fantasy of creating the ‘ultimate bot’, but likely the
expected profitability is the main factor. Hedge funds have long used
algorithmic trading (HFT bots) to earn billions — even if these operate on
microsecond scale, instead of milliseconds that EAs enable. Even still, it’s
undeniable that a person with a properly calibrated Expert Advisor will have an
advantage over someone trying to do everything on hand.
Best Practices for Using EAs in 2025
1. Choose a broker that
allows them.
Many brokers don’t allow EA usage, because these algorithms can be so
profitable in the right hands. Dealing Desk brokers especially don’t like
affluent traders using them sometimes, and can even ban your account for that.
Retail brokers without MT4/MT5 trading platform, or without low-spread
accounts, might also not be the best for using robot-based strategies. Same
goes for brokers that require you to get external VPS. Any broker supporting
EAs should be able to offer an affordable and fast virtual private server that
allows uninterrupted and fast execution, without any limits or restrictions.
At Defcofx,
we welcome all kinds of Expert Advisors and embrace a diverse range of trading
strategies. Whether you’re using a custom-built EA or a popular one, we support
your trading approach with no restrictions.
To address the rise in EA usage, Defcofx now employs top-tier hardware
for trade servers located in the NY4 and LD5 data centers in New York and
London, so the exchanges are within a microsecond. Not bad at all for scalping
with minimal latency.
2. Use MT5, preferably.
MT4 is an older technology without multithreading and high-performance
optimization, while cAlgo is considerably harder to program and to test.
We recommend MT5 and its programming language, MQL5, for its ease of
use, advanced programming capabilities, and built-in strategy tester. It also
has some of the more powerful analytical tools, including custom indicators and
market analysis tools using AI/ML integration.
3. Test your strategies first
Trading Strategy Tester in MQL5 allows you to easily check the
efficiency of your Expert Advisor, and detects the best input parameters before
you run the EA on your real account. It’s a powerful tool crafted for
developers of trading robots. Without the use of the tester, the creation of an
efficient and reliable robot is practically impossible. The Strategy Tester can
save you a lot of money and time, and allow for creating an optimal bot.
4. Make dynamic adjustments.
Regularly updating your bots usually proves the most powerful — making
them more relevant in changing market conditions. Experienced traders usually
have a few EAs in their pocket, changing between them depending on the
situation. This is often the most stable and robust way to trade.
5. Hybrid approach is best.
Combine EA automation with manual oversight, at least at first. Letting
robots run rampant might lead to unpredictable consequences. Even if your
strategy has shown itself effective on a demo account, make sure you trade with
oversight on real at first.
Disclaimer: Article submitted by Defcofx broker team
This article was written by FL Contributors at www.forexlive.com.