You will come across many forex robot sites. How to avoid a scam? Is there a way that can tell you whether this forex robot is real or not? When you look for a forex robot, you must check the following things. If anyone of these things are missing, just take it as a signal that this is scam robot and you have to stay away from it.
1. The developer of that forex robot should be confident enough to post live trading results on the third party sites like MyFXBook or MT4i. If the developer of a forex robot has just posted a few screenshots about the performance of the robot but no direct link to these two sites, just take it as a signal that this is a scam robot. There are some forex robot sellers who have posted myfxbook site screenshots but there is no direct link to the myfxbook page which makes the performance of that forex ea highly suspicious.
These type of screenshots can be easily photocopied. If the performance of that ea was that good, the developer of that ea would have loved to post it on the third party sites. So when you take a look at the live performance results just make sure that actual link to the third party site is also posted and there is no screenshot.
Sometimes developers also post demo account performance on these third party sites. Demo account performance is no substitute for a live account performance. A good performance on the demo account maynot get replicated on the live account. This also indicates that the developer is not confident enough to risk his/her real money trading with that robot. So take this also as a signal that the robot may not be good enough.
2. There should be no questions asked 60 days of money back gaurantee. If there is none, you should take it as a signal that the robot is a scam.
3. Take a deep look at the drawdown of the robot. If the drawdown is higher than 10%, it means that it is too risky.
If a forex robot passes the above three tests, even then you should first test it on the demo account thoroughly. This will help you become more familiar with it plus demo trading is going to give you an idea of how good this robot is. The idea is to make a return of 10-20% per month with a risk of 1-2% on the demo account first. If you can do that for two months, good. Stop falling victim to the forex robot sellers who claim to be making high gains of 100-1000% per month. These type of returns are simply not possible and even if achieved may results in huge drawdowns.