If you’re thinking about using forex signals in order to enhance your forex trading, you might be tempted to start out with free forex signals.
After all, free trading signals have no barrier to entry at all — you could start trading today without having to spend a single dollar. But even though you may think you have nothing to lose, you actually have quite a lot; you’ll be betting your entire account and your time on foreign exchange signals that you may simply not be able to trust.
Here are a few reasons why free forex signals aren’t a good idea, even if they may seem to be a bargain.
Nothing is Guaranteed
What happens if you do find a free signal service that works for you?
Even if the signals actually do work — and there’s no guarantee that they will continue to perform even close to comparatively — you can’t be guaranteed that the forex signal service won’t entirely disappear in a week or two, leaving you in a lurch.
Paid signals have historical data and a reputation; you know that they’ll stick around long enough to make you a successful trader. A free signaling service may not last any longer than it takes for it to empty out your account.
Anyone Can Give Out Free Forex Signals
Literally anyone can start a signaling service and attempt to give out forex signals.
Many of these individuals may simply be inexperienced traders who are either trying to test out their trading strategies or truly believe in their strategies even if they are not backed up by performance data. A paid forex service will have accomplished and experienced professionals who can back up their signals with their own personal knowledge.
Often, you won’t even be able to find out who actually runs a free signal service.
Everyone Makes a Profit Somehow
There’s an old adage: if you aren’t paying for service, than you’re the product.
If you aren’t paying for a forex signal service, than this free signal service is either advertising to you or is selling your information. Regardless, this also means that the service doesn’t have a vested interest in providing you with a good service; they just want to get in enough bodies so that they can sell their own product, you.
Their focus isn’t on developing good trading signals, it’s on finding buyers. Furthermore, getting your information sold is always an unpleasant process regardless. At best, you may find yourself getting late night telemarketing calls and other advertisements. At worst, you could end up with malware on your computer or you could even end up with your identity being stolen.
There’s No Money for Talent or Research
When you pay for trading signals, where does that money go?
It generally goes into research and expertise. Paid signaling services invest large amounts of money into developing their algorithms and hiring and keeping the best talent. With a free service, this simply cannot be done; a free service cannot attract the best and most talented traders.
Who wants to offer winning strategies to strangers for no profit at all? In addition to looking for a paid forex signal service provider, you should also look into the traders that they use.
The Technology Isn’t Available
An ideal forex signaling service will be able to push notifications to you on your desktop, mobile phones, emails, and other platforms. Investing in this type of technology is not a trivial process.
A free forex signals provider may be able to send you emails or display information on a website, but it’s not likely to have a dedicated app or any other ways of receiving your signals. A late signal or a missed signal could mean the difference between a profit and a loss.
Paid signaling services will be able to invest a significant amount of money into the development of these technologies, to reduce the amount of latency between the trades being created and the trades being sent directly to you.
There Won’t Be Any Customer Support
A paid forex signal service can pay individuals to support you when you have any issues. Maybe you’re not getting your signals delivered. Maybe you can’t read the signals because there’s a glitch in the website. Either way, a paid service will be able to help you when you have these problems — a free service won’t have any form of customer support.
Instead, you’ll be left to have to figure things out on your own, and reading a signal incorrectly or not being able to get your signals could be very costly. Things like apps and other platforms may occasionally have glitches that you’re going to need to have resolved — and resolved quickly if you don’t want to miss out on your profits.
You Won’t Improve As a Trader
Many paid forex signaling providers can give you information regarding trading, even if you’re just learning the basics. Why would you need to know anything when using a signal service you may be asking yourself? A paid forex provider will often have a community or documentation and information that will lead you into becoming a better trader and a better investment all around.
Paid trading signals will give you information regarding the strategies they use (even loosely) and justifications regarding many of their trades; they will also have information available to give you about developing yourself as an investor and entrepreneur.
The Trades Will Simply Be Wrong
Perhaps the most compelling reason not to use a free forex signals provider is that their trades generally aren’t correct.
While you can look at their past performance, you can’t see how accounts following them actually performed; all of the data is produced by them and can be tailored to their desires. As far as you know, a free forex signal provider may have initiated thousands of small practice accounts and are only highlighting the algorithms that worked during those periods of time.
Even though these signals may have had past performance, it can be entirely random; they only have to show you their good results, not their bad results. Consequently, it’s very likely that the trades that they offer you are worthless, because they won’t have research and information behind them.
Simply try to AVOID Free Forex Signals
When it comes to investing, it always pays to pay; you get what you pay for in the finance and investment markets.
If someone has something valuable, they aren’t going to give it away for free. Though you may not have to pay a lot for a forex trading signal, you should still look for professional, experienced signal providers who do take a moderate fee.