What is the ultimate Forex trading system? There are plenty of systems sold online that claim to be and in this article we will look at the best Forex trading systems in more detail and the criteria you should use to find a system which suits your risk tolerance.

There is no ultimate Forex trading system because even the best systems will have there plus points as well as there minus points. There are many Forex robots who claim there performance beats the competition and every month, sees a new system with what appears to be a stunning performance but all these systems have a problem, they have never made any real money!

Beware of Simulated Track Records

If you see a trading system with a track record that looks to good to be true – it probably is and this applies to most automated Forex trading systems sold online. The only way, these systems can make money is by testing the system over back data and bending it to make a profit. This is so easy anyone can make huge gains but the problem is when you trade currencies for real, you don't get the closing price given to you in advance!

Look for Real Time Results which are Audited

If you are buying a Forex trading system, make sure, that you have a real time track record which has been verified from an outside source and NEVER trust the so called Live results vendors publish – there not live and they come from the person selling the system – so don't trust them, get independent verification or pass them by.

Look at Peak to Valley Draw Down

When looking at a Forex trading system look at the track record and assume you joined at the worst point and measure the percentage fall from peak equity and then, look how long the trading system took to recover the loss and hit a new peak in equity. Ask yourself the question – could you tolerate the draw down, in terms of your risk tolerance?

If you always assume your worst draw down is ahead of you, you will be prepared for the loss and be able to ride it out, until the system hits a new peak in equity.

In general terms any system, will draw down 20% and the general rule is the bigger the gains, the bigger the dips in equity. If you have a system which makes 100% gains, you can expect draw downs of 30 – 50% and these periods of losses can last from several weeks to several months. System trading is long term and you should judge your performance over 2 – 3 years and discount monthly fluctuations.

Final Words

If you want to automate your Forex trading strategy, you will find a system which can make you money but the ultimate Forex trading system, is the one that you choose, based upon the above comments made in this article. All traders have different risk tolerance and this will mean a system which is right for one trader, may not be right for another.

If you do your homework and pick a system which has made real gains, have the discipline to ignore short term losses and focus on the long term, you can make a great second income in around 30 minutes a day, in the world's most exciting and lucrative business – international currency trading from home.