~~~ Trading FAQ ~~~

About Zorro

What are Zorro's system requirements?
 

Zorro runs on all Windows PCs from Win XP on, and on Windows servers. For running it on Linux or Mac, you'll need a Windows emulator.

Is Zorro really 100% free, even for live trading?
 
Zorro is really 100% free since its development was sponsored. However when you earn more than $ 30,000 per year with Zorro, a sponsorship is required. You can find the license details here.

Is Zorro an online service?

No, Zorro runs on your local PC or on a VPS. It does uses an online connection only for live trading or for retrieving data.

Is Zorro a broker?

Zorro is not a broker. It is a software tool. You need an account with a broker for trading financial instruments with Zorro.

Which brokers are supported?
 
Zorro supports all brokers and exchanges that provide either a trading API, a web based trading platform, or the MT4/MT5™ trading platform. Major brokers such as FXCM, Oanda, IB are directly supported trough their API.

Is Zorro development ongoing, and how often will updates with new features come out?
 
Development is ongoing. New features are regularly implemented. Updates are released every 3-4 months. You'll be notified of any update if you've marked the checkbox on the download form.

Can I use other software tools or web based broker platforms together with Zorro?
 
Yes. Zorro can be controlled by external software and can control other programs either through an API interface, or by directly sending key strokes and mouse clicks to a browser window or an application. It can import and export data from or to spreadsheets, databases, or other file formats. You can write own trading strategy DLLs in any language, or convert trading systems from other platforms to Zorro's C based script language.

How hard is it to write a trading strategy script? I have no experience with programming or financial math.
 
Learn script programming and strategy development with the included tutorial, the Black Book, or the online course. It will take about 1-2 weeks, but is essential for success with algorithmic trading. 90% of people learn programming quickly, but no one can tell beforehand whether you belong to the other 10%. Try and find out.

I've heard that most trading tools are scam. How honest is Zorro?
 

Scam - in the sense of selling useless products or services - is indeed a major income source in the trading scene. It appears that private traders are easier fooled than other groups of the population. But unlike the many "Forex Autopilots", "Trading Robots", or "Advisor Services" offered on countless websites, Zorro's included stategies are based on sound math, and their principles are described and explained. They are free to use (or not), and anyone can understand, backtest, verify, or replicate them.

Why was Zorro developed?

Zorro development was financed by a sponsor. The intention was overcoming the limitations of retail trading platforms, and promoting algorithmic trading to a large audience especially in developing countries.


About Financial Trading

Can trading generate money with no work? If so, why isn't everyone trading?
 
If 'work' means producing goods or services, trading can indeed generate income with no work - just as playing the lottery. Unfortunately the analogy doesn't end here. The human mind is not well suited for finding trade opportunities in price curves. Technical trading mostly depends on luck; skills or knowledge play a minor role. The risk of losing some or all invested capital is about 65% per year for any private trader, regardless of trading skills or experience. Employed professional traders achieve an average annual profit of about 3% above marke, by following rules and strict discipline. There is no 'hidden wisdom' that would make someone a better trader.
   Those are good reasons why people normally stay away from financial trading. Aside from the risk, it's no fun to stare at price curves all day. Day trading can be one of the most boring and miserable jobs to be imagined.

Is a machine superior to a human trader? If so, why isn't everyone trading with machines?
 
Even simple computer algorithms easily outperform human traders and financial analysts. Computers are superior to the humand mind in detecting price patterns, and adapting to market changes. They are not affected by emotions or by all the pseudo-knowledge, superstition, and myths circulating in the trader scene. And they make no assumptions about of the future.
   Large institutions, such as hedge funds and investment banks, are very successful with machine trading. Most private traders are not, since there is no easy access to the skills and software required for serious automated trading. That's one of the reasons why Zorro was developed.

Which profit can I expect with automated trading?
 
As with any trading method, there is no guarantee of profit. In extreme cases, automated strategies can return more than 100% annual profit on the invested capital (Zorro's Z5 strategy returned 240% in live trading from its start in July 2013 until its expiration in January 2015). But this is not a certain income like from a savings account. Due to market changes, trade profits can vary extremely from month to month. It is not easy to predict the future performance of a strategy - certainly not with simple backtests or with trading on a demo account. Advanced test methods - such as walk forward analysis (WFA) - can produce a more realistic profit projection. But even then there's no guarantee to match theoretical profit in real trading.

Won't it negatively affect the financial markets when millions trade with automated systems?
 
It depends. Trading supports the markets by providing liquidity, but some trade methods, such as high-frequency trend following, can have a destabilizing effect and cause market crashes. Other methods - mean reversing or cycle systems - can stabilize the prices. Zorro's included strategies use only methods that are not supposed to harm the markets.

Automated trading - what's the catch?
 
Here's a list of problems you might encounter when you let a machine trade with your money.
- Trading is not for anyone. Aside from the usual trading risks, there are further risks associated with automated trading, such as script errors or software bugs.
- Trading can become addictive, just like gambling.
- Trading does not produce any goods. It only redistributes money.
- Trading requires capital: at least $200 for trading one of Zorro's included strategies, at least $10,000 for a substantial monthly income.
- Trading requires strong nerves. Even highly profitable strategies can have long losing periods.
- Trading strategies can expire. Massive market changes can cause profits to suddenly stop with no prior warning.

Does financial trading serve any useful purpose, or are traders just parasites?

Opinions are split, so we're just quoting the 1976 Rosenthal report: "A basic freedom we have in virtue of living in a capitalistic country is that we are free to speculate on the movement of prices. This freedom does not require an additional justification, such as promoting the interest of commercials. All that is required is that the general public not be harmed and that the market place be organized according to fair rules and procedures."

Where does the money come from that I earn with trading?
 
From two sources. One is the price movement of the asset, which can generate (or destroy) money out of nothing. The second source is other trader's losses. A good part of your income could thus be sponsored by investment banks, hedge funds, or other big financial institutions that employ traders.