Being able to customize the trading tools that you use can significantly boost your trading experience and results. In some areas, we are faced with a certain degree of rigidity, where we are not able to make customizations and configurations. But when it comes to the expert advisors or EAs that are used with MetaTrader 4 platform, you can create your own custom tools. In this article, we are going to delve into the fundamentals of how it is possible to create your own expert advisor from scratch.
Basics of Expert Advisors and How They Are Developed
To begin down the route of developing your own custom expert advisors, you need to understand the basics of how they work and they are developed originally. Basically, an expert advisor is an automated trading tool developed specifically for the trading platforms of MetaTrader. Given that MetaTrader platforms themselves have been developed by the company Meta Quotes, it is only natural that all the programming language involved in the entire process should also come from the same origin.
The programming language used in the development of the MT trading platforms and also their components such as expert advisors is known as Meta Quotes Language, which is also shown as MQL4.
According to an interesting statistic published by the Code Academy, MQL4 is among the most up and coming programming languages in recent years. That is quite a telling piece of data. It clearly indicates the rising intertest in expert advisors.
And there are clear reasons in favor of this rise in the use of expert advisors and also the rising increase in interest to develop them. Expert advisors or EAs provide an opportunity for traders to automate their trading process partially or wholly. This can be an expert advisor that is in charge of executing a single technical indicator and providing the result to the trader or an expert advisor which is able to carry out the entirety of the trading process.
So now that we have a basic grasp of expert advisors and the programming language behind their development, let’s get started with the basics of developing your own EA.
How to Get Started with Expert Advisor Development
The very first step toward developing your own custom expert advisors is to get MetaTrader 4. Naturally, you need to have access to the MT environment to be able to code and create EAs. Of course, you can get the MT4 software either via your broker or via the official website of MetaTrader.
Once you have MT4 up and running, then it is time to open the relevant environment for coding MQL4. This environment is known as MetaEditor.
To access MetaEditor, you can move to the toolbar of MT4 and then open this section, or you can simply press F4 to open MetaEditor. Once there, you can begin the coding process to develop an expert advisor.
Main Components Involved in Expert Advisors
There are certain components that can be considered as main and integral of almost any expert advisor. For instance, an expert advisor can be said to contain the following three main components or functions:
An EA consists of three main sections:
- Initialization: The functions that are known as OnInit()will run when the expert advisor is loaded by the user. This function will then let you put in certain initial parameters and configurations of the EA.
- Main Loop: The other main function known as OnTick()is activated whenever a new market tick is received. This component helps with the formation and implementation of the trading logic behind the expert advisor.
- Deinitialization: The OnDeinit()function is yet another main component and this function is activated when the expert advisor is removed. This will allow you to clean up the resources.
Aside from the main components discussed above, there are also some core components that are also part and parcel of any expert advisor. These core components are as follows:
- Order Management: Functions like OrderSend(), OrderClose(), and OrderModify() are among the most crucial and core functions of expert advisors which play an important role in order execution.
- Risk Management: And then there are other core components which will help the EA determine factors related to risk management, which are factors such as the calculation of the prop lot size, stop loss orders, take profit orders, and such.
Begin Coding and Developing the Expert Advisor
Now that we are also familiar with the main and core components of any expert advisor, it is time to begin coding with MQL4 and actually developing the custom expert advisor. As this process can be complex and detailed, we will simplify it in the following steps:
Step 1: Defining the Trading Strategy
The very first step into developing your own custom expert advisor is to clearly define the trading strategy that is to be implemented and then deployed by the EA. This is of course the most important part of any expert advisor. In defining the trading strategy for your EA, consider the following factors:
- Market Conditions: the specific market conditions under which you want the expert advisor to operate. This refers to whether the market is trending or not and other conditions.
- Entry/Exit: this refers to the signals which will trigger entry and exit points for the EA, which directly relates to when the expert advisor will open buy or sell positions.
- Risk Management Rules: what is the risk management level for your EA? Is it conservative or more aggressive? Define stop loss and take profit levels to specify your risk management approach.
Step 2: Going to MetaEditor
You can open MetaEditor by following this path: File > New > Expert Advisor (template)
Or you can select F4. Either way, once the new template is opened you can follow the prompts to get to the editor.
Step 3: Actually Writing the Code
Expectedly, the most important part of developing your own expert advisor in MetaTrader is writing the code. As we have discussed so far, the programming language used is called MQL4. The following is an example of what this code looks like along with the most important components of any expert advisor, such as risk management parameters like take profit, stop loss, and also lot size, in addition to defining the parameters as to when the EA should enter and exit position.
// Define input parameters
input double TakeProfit = 50; // Take profit in points
input double StopLoss = 50; // Stop loss in points
input double LotSize = 0.1; // Lot size
// OnInit function
int OnInit() {
// Initialization code here
return INIT_SUCCEEDED;
}
// OnTick function
void OnTick() {
// Simple trading logic
if (ShouldBuy()) {
OrderSend(Symbol(), OP_BUY, LotSize, Ask, 2, 0, 0, “Buy Order”, 0, 0, clrGreen);
}
if (ShouldSell()) {
OrderSend(Symbol(), OP_SELL, LotSize, Bid, 2, 0, 0, “Sell Order”, 0, 0, clrRed);
}
}
// Example of entry condition
bool ShouldBuy() {
// Define your buy logic here
return false; // Replace with actual logic
}
// Example of exit condition
bool ShouldSell() {
// Define your sell logic here
return false; // Replace with actual logic
}
Step 4: Compiling the EA
Just like any other programming language the programming process, once the code is done being written, it is time to compile it and see if there are any errors or bugs. So, at the end of coding MQL4, you can click on the Compile button or you can also press F7 for the same function. Unless there are some errors, your expert advisor should be ready for implementation.
Step 5: Testing the EA
As it is the case with all expert advisors, before implementing them and actually using your real assets with them, you need to test them with the backtesting feature of MetaTrader. This testing process will allow you to expose the EA to historical market data and see how it would have performed under those conditions. So it is great for both checking the performance of the EA and also finding out possible weak points for improvement.
To access the backtesting feature, you need to go to the Strategy Tester section via this route View > Strategy Tester or you can simply select Control + R.
Once there, you can select the specific expert advisor you want tested and then pick the necessary parameters for the testing process. Then you can run the test and wait to obtain the relevant report from the testing process.
Conclusion
While there are many already developed and ready to use expert advisors for MetaTrader 4, there is always the option to develop your own. This opportunity is a huge upside for savvy and experienced traders who would like to impose their own touch and create their own expert advisor from scratch. This way, the final developed expert advisor is precisely fine tuned only to your own trading conditions and trading needs. You can follow the steps that we have provided in this article to get yourself on the way to developing your very own expert advisor.
