Documentation · Fundamentals
How an Expert Advisor works
An Expert Advisor, abbreviated EA, is a program that operates on the MetaTrader terminal by applying a strategy written in code. This page describes the full chain, from the logic to the broker's confirmation, and the points where the result can deviate from the expected one.
Definition
An Expert Advisor is a software module executed inside the MetaTrader 4 or MetaTrader 5 terminal. It reads the market data the terminal receives from the broker, evaluates its own conditions and sends orders. It is not an investment account and it does not hold money: it is an automation that acts on an account the user has opened with a broker.
The execution chain, step by step
- 1. Market data. The terminal receives prices and volumes from the broker through the feed. If the feed is interrupted, the EA stops having up-to-date information: it is the first point of fragility of any automated system, and the reason why a machine that is always on is used (see VPS requirements).
- 2. Strategy evaluation. On every tick or on every new bar, the EA checks its own conditions: time, session, indicators, levels, news filters. As long as the conditions are not met nothing happens, and that is already operational behaviour.
- 3. Lot size calculation. When the condition triggers, the EA determines the trade volume based on capital, accepted risk and stop distance. This is the step where a setting that is too aggressive produces a risk much higher than the expected one.
- 4. Order submission. The order is sent to the broker. This is where spread, latency and available liquidity come into play: they are the factors described in requote and slippage and in spread, slippage and commissions.
- 5. Confirmation and management. The broker confirms execution at the actual price, which may differ from the requested one. From that moment the EA manages the trade: stop, target, trailing, early close according to the strategy rules.
MetaTrader 4 and MetaTrader 5
The two terminals share the underlying idea but differ in programming language, order management and available tools. An EA written for MT4 does not run on MT5 without a conversion, and vice versa. This is why Softi products state explicitly which terminal they operate on.
Official references: MetaTrader 5 documentation e MetaTrader 4 guide.
What an Expert Advisor does not do
- It does not eliminate market risk. It automates the execution of a strategy, it does not make it immune to losses.
- It does not guarantee the execution price. Slippage is a market condition, not a defect of the software.
- It does not predict the future. Strategies react to present or past conditions; historical results do not repeat by construction.
- It does not manage capital for you. No Softi EA has access to the funds: orders go from your terminal to your broker.
The operational limits and the metrics by which a strategy is measured are described in drawdown and recovery factor, and the full picture of the risks in limits and risks.