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[Basics] [Basics] What is an EA? How it works and what's risky
An EA (Expert Advisor) is a program inside MT5 that places orders automatically by fixed rules — "buy when this happens, sell when that happens," written as code.
How it runs
- Put the EA file (.ex5) in MT5's Experts folder
- Drag it onto a chart and set its inputs (lots, stop loss, etc.)
- Turn on Algo Trading; every time the price moves, the EA checks its conditions and trades
- If MT5 is closed, the EA stops. That's why people run it on a VPS (remote server) that stays on 24/7
Pros
- Follows rules without emotion (never postpones a stop)
- Catches opportunities while you sleep
- Lets you see past performance with backtests
Risks
- Overfitting: an EA tuned too tightly to past data falls apart live
- Martingale, grid, averaging down: betting bigger after losses. The equity curve looks smooth until the account vanishes in one go
- No stop loss: many commercial EAs have no stop or a very distant one
- Broker differences: different spreads and execution speed change the results of the same EA
What to check when choosing an EA
- At least 6–12 months of real-account history (be careful if there are only backtests or demo results)
- A stop loss on every entry
- The maximum drawdown (MDD)
- Whether it has lived through different market conditions (up, down, sideways)
The stickers on EADesk cards (No stop-loss, Martingale, Grid, Averages down) are warnings from members who actually ran them. For live-linked strategies, the reporter automatically records the share of entries without a stop.
