Expert Advisor (EA): definition | Glossary

A program trades by rules you set:it follows them and won't forget.

An automated trading program that runs on the MetaTrader platform.

EAs execute trades based on pre-programmed rules and algorithms without requiring manual intervention.

In plain words

An expert advisor, or EA, is a program that runs inside the MetaTrader platform and trades without anyone clicking. It follows rules written into its code: it reads prices, checks whether its conditions are met, and sends, changes or closes orders.

See it move

Go round the cycle

Check rules, then Send order

A loop runs from reading prices, to checking the rules, to sending an order, to managing the trade and back again; moving the pointer round the loop shows what the program does at each step.To try it, point at the diagram, drag a finger across it or use the slider: go round the cycle.

Why it matters

An EA applies its rules the same way every time and can run around the clock, which a person cannot. It also has no judgement: it does exactly what it was coded to do, including when market conditions change or its connection fails, so it still has to be supervised.

Worked example

An example only. The figures are round and invented for the arithmetic: they are not market prices.

An invented EA has one rule: buy 0.10 lots when the price closes above its 50-period average, with a stop-loss 40 pips away.

1Pip value at 0.10 lots = 0.0001 × 10,000 = 1 US dollar
2Loss if the stop is reached = 40 × 1 = about 40 US dollars
3Five losing trades in a row = 5 × 40 = about 200 US dollars

The program repeats its rule faithfully, including through a losing run of about 200 US dollars, until someone stops it.

A common mistake

Good results in a backtest, a run over past prices, are often taken as proof that an EA works. Rules can be tuned to fit the past closely and then behave quite differently on new prices.

Check yourself

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Educational information, not investment advice or a recommendation to trade.