As financial markets, especially the forex market, have gone above and beyond what anyone would have expected them to with the influx of countless traders to these markets, there has also been an uptick in the use of automated trading solutions and tools in these markets.
A particular type of automated trading tools that is specifically used with the popular trading platform MetaTrader are known as expert advisors. The tools, which are otherwise known as EAs, have garnered stupendous attention recently due to their huge upsides for traders. As with any other tool online, there are both free and paid options available. And that is exactly what we are going to discuss in this article and compare these two types of expert advisors.
A Deeper Understanding of Expert Advisors
Prior to discussing the actual pros and cons of free and paid expert advisors, it is better to discuss the notion of an EA itself. As briefly discussed above, an expert advisor is basically an automated trading tool, otherwise known as a trading bot, that is specifically to be used with the trading platforms of MetaTrader, either MT4 or MT5.
So an expert advisor is basically an algorithm written for MetaTrader that is able to execute trades based on those instructions. Expert advisors are such that they can be used by both novice and professional traders to tackle all sorts of trading challenges.
Their allure for amateur traders is that they can take over the trading process entirely and even if you are completely new to the financial market and to world trading, then the expert advisor would still be able to trade on your behalf. And for professional traders, expert advisors can provide the opportunity through the automation of processes, such that the trader can dedicate their time to other markets or trading opportunities.
Now that we have a better understanding of expert advisors and just what they are able to do for traders, let’s compare free and paid EAs.
Pros and Cons of Free Expert Advisors
Just because something is free it doesn’t mean they are without their advantages. So for this reason, here we want to make a case for expert advisors and also against them.
The following can be regarded as the pros for free expert advisors:
Cost Efficient:
Naturally, the most obvious advantage of using free expert advisors is that such tools are easy on your pockets! The fact that they are free of charge is of course one of their most significant advantages. This is quite appealing especially for those traders who do not have a lot of experience with automated trading tools and want to begin using them but they do not want to spend a lot of money.
Good Selection:
Although these tools are free, they are by no means limited or scarce. Quite on the contrary in fact. The community forums, groups, channels, and countless websites offers an excellent selection of these free tools. This is also a good advantage especially for novice traders to be able to pick and choose from among a variety of tools, whichever that they feel is most ideal for their situation and requirements of trading.
The Community Behind These Tools:
A rather unusual or at least unexpected advantage of these free tools is the community itself which is behind them. Since the origin and the developer for the majority of these free tools in the forex market or other markets are unknown, you are faced with a decentralized means of obtaining and maintaining such tools that involves the traders themselves. So you can ask any question that you want from them and defer to their comments and testimonials of using those tools.
Possibility for Trial & Error:
This is perhaps the biggest advantage of free expert advisors. Because you do not have to pay for them, this creates an excellent opportunity for trial and error for you to learn the ins and out of automated trading without having to spend money on the tools. In this way, once you have gained sufficient experience, you can then purchase a paid expert advisor and trade with a more advanced tool.
Although we have started with the advantage of such free tools, there are, as expected, certain disadvantages associated with them. As such, the following is a list of the cons of free EAs:
Low Quality and Performance:
As it is to be expected, when a tool is free, you shouldn’t really expect a high quality from that tool. As such, when it comes to free expert advisors, they are quite limited in their quality and performance. So keep this in mind as to not to rely on these tools more than you should.
Limited Range of Capabilities:
Aside from the low quality of the tool itself and also the constrained performance that such tools are able to present of those mentioned low quality features, there is also another limitation in terms of the range of the capabilities themselves. While certain paid expert advisors are able to take care of every single aspect of trading, free expert advisors are almost always limited in their extent of capabilities of what they can execute.
No Official Support:
Precisely because the origin of many of these free tools is not known, the kind of support and help that you can receive for them is never official. Although there might be a lot of community support and help, there is no single developing platform that would officially address your questions and problems.
Pros and Cons of Paid Expert Advisors
Just like we have discussed the pros and cons of free expert advisors, it is time to talk about the upsides and downsides of paid expert advisors. First the advantages.
High Quality and Better Performance:
First and foremost, when it comes to paid expert advisors, it is their increased and high quality of performance that sets them aside. Paid EAs are therefore much more reliable and able to execute trading processes with enhanced precision.
Higher Range of Capabilities:
Aside from the enhanced and improved performance of such tools compared with their free counterparts, another feature that is seen with paid expert advisors is that there are simply more features available with such tools.
Receiving Official Support:
Paid expert advisors are often tools that have been developed by a whole team and a dedicated project. As such, there is also a dedicated support team behind such tools. This means there is a whole team of support always ready to answer your questions and inquiries about the expert advisor.
Better Returns:
Given the enhanced performance and capabilities of paid expert advisors, they are able to provide traders with much better returns on their investment. This is simply never possible with free tools which are quite limited in their reach and performance.
Official Updates:
Another unique advantage of paid expert advisors is that they will receive continued and official updates from their developing team or platform. Something that is almost never at all seen with free expert advisors. The free tools are usually developed and put out for traders to use never again to be updated or improved. But of course paid expert advisors are continually updated by their team.
But of course just because you pay for something, it does not mean it comes without downsides. The same is true for expert advisors. Here are the cons that are associated with these paid tools:
You Need to Pay for Them:
First and foremost, there is the matter of the cost. You actually have to pay for these tools. Of course, given the particular expert advisor, you will need to pay hundreds of dollars for them at times. Now keep in mind the prices can range quite heavily from only like a hundred even to a grand or more.
Finding Reliable Platforms:
Yet another challenge that is associated with paid expert advisors is that you need to find a reliable platform to purchase the tool from. There are unfortunately some cases of scams that sell expert advisors but do not deliver on their promise. Or certain other frauds that sell expert advisors that would later steal your trading capital from you. So if you want to purchase an EA, you need to find a platform that can be trusted.
Over Trading with EAs:
Another potential downside of using paid expert advisors is that you might simply get too reliant on them. When traders put too much of their trust in such tools, this means they do not dedicate enough time or energy to develop their own skills as traders.
Free or Paid? Make a Decision
Now that we have listed all the major pros and cons associated with free and paid expert advisors, it is time to discuss how you can go about making a sound decision between these two choices that you are faced with.
It all boils down to your needs and requirements of trading. You already know all the pros associated with free EAs. But still you need to remember that no free tool can compare with a proper paid expert advisor.
