Wednesday, January 30, 2008

Pointbreak Expert Advisor Final Review, Week 5, C'est Finit

After five weeks of trading the Pointbreak expert advisor and looking closely at the way it closes and opens trades I have just one opinion, for me, c'est finit, it is finished.

Last week I wrote a post which was fairly optimistic about the trading of the Pointbreak expert advisor. I said that I was convinced about the trading strategy, it's closing and opening mechanisms, etc. But well, to err is human. The expert advisor itself has shown me this week how all I believed it was supposed to do was incorrect.

I had the following notions about Pointbreak (maybe you have them too) . I though that the expert :

- should make profits when there is a strong trend
- was supposed to keep draw down at a low level (below 7% at least)

- is supposed to give a 10% annual return
- controls draw down effectively

This week, Pointbreak showed me how all of them (except the 10% annual return which I did not prove or disprove) are - in my opinion - not entirely correct. The expert advisor managed to obtain a massive open draw down (for the conservative setting) which was above 9%. This puts the annual risk reward ratio in the 1:1 area, something that is way too risky for the amount of profit I am waiting to obtain.

The EUR/USD also clearly trended upwards from the beginning of this week (see chart below). Pointbreak didn't show this on it's results, only increasing it's open draw down as it accumulated sell orders (something I wouldn't have expected it to do).

This puts a question on my mind. How much does it have to accumulate to realize a loss ? It is clear on my mind that if it didn't close trades with a 9% open draw down then this may happen with a larger loss, this for me, to win only a 10% yearly profit (as they say this is what they guarantee) , is clearly unacceptable.

This of course, has made me decide to stop trading the Pointbreak expert advisor. My final opinion on this expert advisor is then pretty clear. I consider it - through careful examination of forward testing results - to be extremely risky for the amount of profit obtained. I consider the risk of a massive draw down due to sudden market movements a reality and I also consider the margin requirement of Pointbreak to be excessive for it's risk reward ratio.

The expert has clearly showed me that it does not catch trends as accurately as I would have liked, it also showed me that it does not close positions even on a 9% open draw down and it also showed me that profit accumulation is excessively slow and accompanied with an almost hidden open draw down risk. You have seen my comments (both positive and negative) on the forward testing results. You can see the trading statement here. Judge for yourselves.

Tuesday, January 29, 2008

Forex Killer Review, an Unbiased Perspective and Strategy

Please do not consider this review as a recommendation to buy forex killer, I wrote it to help people who have already purchased the product and want to get something out of it but the software is barely of any more use than most of the freely available indicators out there. You can get the same or better results with simple indicator based systems !

I was looking at several forex trading systems the other day - mainly expert advisors - when I realized that my whole focus has always been on automated trading systems. I thought - maybe I'm missing on some opportunities - so I decided to take a look at some of the most broadly known forex trading systems. I mean, the mass marketed, almost scam looking, forex systems. The ones with the testimonial filled selling pages where you are almost pushed to buy.

One almost instantly caught my attention due to the enormous amount of positive "reviews" available online. I say "reviews" because almost all of the web pages are absurdly biased. They have affiliate links all over the review, not meaning they are lying, but implying they have a concrete reason to do so, mainly getting a profit. For me, any review made on a product that includes an affiliate link is by definition not trustworthy, not necessarily dishonest.

So I decided to test it myself. It really wasn't that expensive so I guessed it wouldn't have hurt if I bought it. The forex system I bought is called Forex Killer.

The system promises heaven (sounds familiar?), telling you that you will earn thousands of dollars everyday. Quiet enough to quit your everyday job and dedicate yourself to forex trading. The website also states that the system is good for newbies (no experience required) and is easy and profitable by itself. The system basically tells you that it is the solution to all your financial problems. Well... I have a story to tell you.

At first glance, it really looked like a trading system for dummies. Big buttons, simple graphs, apparently simple interface and a simple instruction pdf. Well, I started to try and see the software through the eyes of a forex newbie trader, I was frankly lost. The instructions really don't tell you much. They don't tell you anything about actually trading, how to precisely interpret signals, make decisions, etc. This was a real turn off for me. You would have expected such an advertised piece of software to explain the whats, whys, whens and hows of the situation. What you get actually makes you feel like an abandoned child which ultimately would lead to you loosing your money.

After a while I started to figure the basics of the software. Save Metatrader data, import, calculate signals, execute signals. The problem actually has nothing to do with importing the data or calculating the signals. The missing part and the most crucial one, is forgetting to teach interpretation and discretion. What signals to ignore and which ones to execute. I'm fairly literate and experienced in forex trading so I decided to apply some very basic rules and try to make the software work.

And I did just that. You can see the rules in the ebook I am selling for 75 USD - just KIDDING ! - I want to tell everyone this rules so that you can consider them yourselves and not actually loose the money you spent on this piece of software (keep in mind they are just a suggestion, no guarantees what so ever). The rules I am going to tell you have worked for me for the past week, actually making me 55 pips per day, average, still no losing days (only tested for two weeks though). I have managed to get about an 80% winning rate, all this on a live account (trading about 0.01 lots for safety !). I have spent about 10 minutes everyday on this.

It is a simple set of instructions anyone could follow (I hope even the newest of rookies) :

- Set a time of the day to start trades (does not matter what time, I have tested this, it still works). Do not trade on Friday's.

- Start up Metatrader (which you can download for free) and Forex Killer 2 (which I guess you bought).

- Open one hour charts for all the currency pairs available on Forex Killer (the ones on the drop down menu). Now save all the data from this charts in a given directory.

- Load one of them, for example EUR/USD, on Forex Killer 2

- Choose the appropriate currency and timeframe (1H) on the drop down menus.

- Press calculate and wait until it shows you the results

- This is the important part. You are going to see if the trading signals from short and long term periods match. If they do you, then you are going to look at the probabilities (below the charts) if they are above 70% (just has to be one of them), then you will return to metatrader and look at the daily chart for that currency pair. You will see where the daily chart trend is going (up, down, sideways), if your signal is in the direction of the daily trend, then we take the trade. For that we use the long term stop loss and take profit values. Also remember to set a 35 pip trailing stop for your order.

- If any of the above criteria is not met you do not take any trades and load another currency. If you take the trade then set up the trade and return to Forex Killer 2 and continue checking currencies.

- Setup as many trades as you find are completely compliant with the above rules.

- Let the trades be and check them the next day at the time you designated for this. Do not close any trades until they are closed by one of your preset stops or take profit limits.

- Repeat the above process and open orders again. You will hardly ever open more than 4 trades each day, with most of them closing during the first day, all of them on the second day almost all of the time. You will have 7 or 8 trades opened (that is the most I've had).

The above has managed to work for me. The system seems to be quit profitable but it required a previously acquired knowledge of the forex market. No new trader could have figured that without considerable training, learning, etc.

Finally, the point you all came to this review for. I do not believe Forex Killer is a scam, neither is it what it advertises. It is definitely not what I expected in terms of the documentation that was provided with it, but I believe that with the above strategy the system has the potential to be very profitable. It is actually, profitable for the people that already have some or a lot of knowledge about forex trading. If you want to try my system do it on a demo account or on a live account with really small lot sizes, remember money management is the corner stone of success in the forex market.

I say it does deliver what it promises in a very shady way. It does not guide traders as they would have expected with a truly lacking, plain, simple instruction booklet that does not tell you anything really useful about how to use this system to trade. But the system is, as I have said, capable of generating consistent profitable signals (although signals would be very difficult to follow accurately with no trading experience).

My recommendation for you is to give it a try if you feel your knowledge on forex is not zero, you have little time for trading and you have realistic financial expectations from the forex market. That said, not thousands a day initially. It also seems to be a great system for busy people, as an example, taking me only a few minutes a day to use. So I hope this review was helpful for the people who bought fxkiller it and don't know how the heck it is used.

I wish you the best of luck in trading and thanks for reading this very long review. Please check my other reviews on automated trading systems (no affiliate links, I promise !) !

Saturday, January 26, 2008

A Possible Ebook About Automated Trading in The Forex Market

The objective of this post is just to get your opinion about something I have been thinking about for the past two weeks. I have had the idea of writing an ebook about automated trading. This including my personal experience with several experts, my backtesting and forward testing results (with analysis of course), my views on free experts, commercial experts, setup explanations and profit/loss potential. The idea would be to guide someone completely new to automated forex trading towards the best free and commercial experts as well as explain the real profit or loss possibilities in forex automated trading. I would like to make it concise, about 20 pages, but very informative to novice traders who want to consider automated trading seriously. As always I would maintain my non-affiliate status with all commercial expert makers to remain unbiased throughout the whole process.

My questions for you are very simple. Would you be interested in paying for this ebook ? How much would you be willing to pay ? What would you like for it to contain ? What are your doubts and questions about automated trading ?

Last but not least, I would like to thank in advance anyone who comments and leaves his/her opinions about my proposal. Happy trading !

Thursday, January 24, 2008

Free Expert Advisor Portfolio, Week 8, Up and Running !

This week has been a very bumpy one for the free expert advisor portfolio 2. As I have also had some time, I have paid close attention to almost all of it's trades, understanding what it has for it and what it has against it.

This week saw a major surge in profit with a gain up to 15,000 which stands at the 50% profit line. Then it dropped (as I would have expected) to more discrete levels at 13,000 which is a modest profit of 30%.

Up until now, the portfolio has showed us it can deliver a 15% average monthly profit, it has also survived almost two months of forward testing, which I say, cannot be said for about 90% of all the expert advisors out there (and probably not about the individual experts in the portfolio by themselves).

I have also seen that the portfolio has both strengths and weaknesses. The portfolio is strongest in trending markets, being very oscillating around moderately ranging markets. Ichimoku5 seems to take trades permanently while Moneymaker v2 is more peaceful (so to speak) in it's trading. Moneymaker's entries are much better than Ichimoku's which seems to trade long term market direction.

Up until now, the portfolio is still up and running, giving us a pleasent surprise about what can be achieved with a combination of free experts. I will hopefully start running another portfolio sometime during the following month. As always, the trading statement for this portfolio can be found here.

Pointbreak, Week 5, Still on the Race

As I mentioned on my last post about the Pointbreak expert advisor, I was concerned about the possibility of massive large open draw down with this expert. I even made a comparison between Pointbreak and a grid trading system which was the feeling Pointbreak was giving me at the time.

Now I have to say, Pointbreak is really nothing like a grid system. I have watched the expert closely this week, focusing on the way it opened and closed it's positions. The expert knows when it has a large draw down and acts accordingly.

When the ea was facing a nearly 5-10% open draw down last week, I was a bit concerned about it being killed by the ranging market. Although my concerns were quiet well founded, I have to say that they don't exist anymore. This week has showed me how Pointbreak behaves in "dark times" and the behavior has been what I had been told. Pointbreak will indeed suffer in ranging markets, but it is designed to survive them and ride trends thereafter.

Pointbreak has not lost the profit it has made, neither has it increased the open draw down it suffered from last week, the expert remains in a battle against it's open draw down, waiting for the tides to calm and a clear trend to continue. I also analyzed the chart provided by the detailed statement. I have to say, it looks like a very conservative profitable expert advisor. The statement as always, can be seen here.

Wednesday, January 23, 2008

God's Gift Expert Advisor, Week 2, First Trade !

The post I wrote about the God's Gift expert advisor got a lot of attention from my readers. Unfortunately I have not been able to publish any reviews about this ea due to the lack of trades. Apparently this expert advisor is a really infrequent trader, trading only every two or three weeks.

Today, after two weeks of forward testing, the ea finally decided to perform a trade on the GBP/USD. The expert advisor executed a buy order which resulted in a 98 dollar profit, which is about 1% of our balance. I like infrequent traders better than frequent ones, this because I always get the feeling that they aim for higher probability trades (but this is just a feeling it might or might not be the case).

It seems that due to the nature of this expert advisor, it makes no sense to review it every week, therefore I will do it every month so that we can accumulate a fair amount of trades before each post. I decided to host the trading statement here, if you which to see it. You can also see a chart displaying the indicators the ea uses as well as the only trade that has been made.

Saturday, January 19, 2008

Doubleplay v 4.0 Live Testing

As you may know, I stopped doubleplay's live trading as the expert advisor seemed to have a fundamental flawed related to the delay feature which prevents the opening of a position as soon as another one closes.

I was actually right. Hal, the creator of the expert, answered my email promptly telling me that other traders had also made the exact same complaint. As a result, Hal emailed me a fixed version of the expert advisor which is now in a live forward test using an interbankfx mini account I use for this purpose. The account has a hundred US dollars and will start trading tomorrow, Sunday, January the 20th as soon as the market opens.

First results and review will be published after two weeks of testing. Wish me luck !

Friday, January 18, 2008

New Chat on the Blog !

I wanted to tell you that I have just installed a new chat service accessible through the left navigational panel. You can leave messages or speak with me if I am online. It is a secure way to leave your email address or other contact information in case you want to speak or discuss anything with me personally.

I hope we all enjoy this great service and continue our hopefully profitable and long trading careers !

Metatrader 4 Backtesting, Reliable or Not ?

As many of you may already know, the Metatrader 4 trading platform has a strategy tester whose objective is to evaluate a strategy based on historical data, rather than executing an expert advisor for an extended period of time. But the question for many remains, is it reliable ?

This question is of the highest importance as many decisions could be based on this feature of the program. Someone who believes in the backtester being accurate will have no problem in using it as a filter for his expert advisors and also using it as a measure of an unknown strategy.

First of all, we have to be very clear. There is only one way to test the accuracy of the strategy tester in Metratrader 4. First, we need to run an expert advisor in a demo account for a given period of time, second, we must backtest this exact same expert in that exact same period of time. The comparison between trades taken in both settings will let us know if the backtester is or is NOT accurate.

Many people say backtesting is not accurate because the expert was profitable for two months of backtesting, then wiped out the accound in real life. This is actually NOT an indication of a flawed tester (the expert could have behaved this way naturally because of changing market conditions). To be clearer, an expert being profitable in backtesting and not in forward testing is a necessary but not sufficient condition to declare the backtester unreliable. To be sure, you must perform the test suggested on the third paragraph.

To do this, you must first set the backtester so that you can get the best possible results. For this I have set my metatrader platform with alpari historical one minute data dating back to 2004. You also want to use the every tick mode and use every less time frame in your analysis. I have done small tests for different expert advisors and I have arrived to the following conclusions.

- Expert advisors that open and close trades in a 1-4 minutes timeframe CANNOT be accurately or even approximately tested with the Metatrader 4 backtester, this, because the tester uses fractal interpolation. It guesses what happens under the one minute candlesticks.

- Expert advisor behavior is not predicted in any case when a sudden move occurs in a one minute candlestick. When an expert trades a 100 pip move which occured in under a minute (like after some NFP releases). In many cases the results in reality and with the tester are fairly different.

- Experts that trade 1-3 times a day and have wide (50 or more) stops and take profit levels are usually predicted far more accurately than experts with tighter levels.

- Experts that trade on the closing price of bars sometimes exhibit abnormal profits because of "divination" of the strategy tester. It uses future knowledge by mistake.

- To deem an expert advisor profitable by backtesting, at least a 3 year analysis are necessary. This supplies a wide range of market conditions, which would at least justify a demo testing of the expert advisor.

So is backtesting useless ? This is actually NOT the case. Would I buy an expert advisor based on backtesting ? Absolutely NOT ! The reliability of the results is very dependable upon the nature of the expert advisor and only access to the source code and understanding of the trading method can guarantee a critical grasp of the tester's results.

So personally I will continue to use metatrader's backesting as long as I know that the expert does comply with the requirements necessary for reliable testing. I will, however, never buy any commercial experts based solely on backtesting as it is - quiet frankly - easily fooled by programming manipulation.

Thursday, January 17, 2008

Pointbreak, Week 4, Ranging Down the Hill

As I have buttressed in my previews Poinbreak reviews, this expert advisor does quiet badly in ranging markets. This week was the complete confirmation of this fact with an even larger range on the EUR/USD pair.

As I have analyzed Pointbreak's moves for the past week, I have realized that Pointbreak set itself up as if the pair would have continued through 1.4900 up to 1.5000. As we all now, the pair did quiet the opposite and bounced back to the 1.46 figures. This frustrated Pointbreak's attempts to elucidate a trend and quiet frankly ended with a large open draw down after the pair did it's rebound.

This I think is the worst possible market condition for Pointbreak a 200-300 pip range in which the market continuously tricks the pair into thinking that a trend has been established when in fact it just reverses.

Up to this point, pointbreak has an open draw down of almost 1500, which puts this expert at a not very comfortable level (almost 10% open draw down). It is kind of feeling like a grid system right now and quiet honestly I am not digging this very much.

I do hope that Pointbreak will recover and indeed manage to stablish a trend the next couple of weeks. While this happens we get to see how this expert reacts to harsh market condition. The statement, as always, can be viewed here.

Free Expert Advisor Portfolio 2, Week 7, Above the 20s

This week has been very interesting for the Free expert advisor portfolio. The portfolio has managed to keep profits above the 20% mark which seemed to be very hard only a few weeks ago. I just came in from a small vacation near my hometown and was extremely pleased with the results I found for this very neat combination of experts.

As always, the most active experts have proven to be Ichimoku5 and Moneymaker, with the ADXCrosstrader also making profits this week (probably due to all the activity on the EUR/USD pair).

I have to say, this portfolio has gone way beyond what I thought it could achieve. Sustaining profit throughout almost 2 complete months of forex trading, including holiday trading which is by far the toughest.

The portfolio has also managed not to increase it's maximum or relative draw downs keeping them near a 25% level which I think is relatively acceptable for a 10% monthly profit margin. As always the trading statement can be seen here.

Friday, January 11, 2008

Free Expert Advisor Portfolio 2, Week 6, Slow and Steady !

This week has not been very exiting for out expert advisor portfolio. Every expert advisor traded throughout the week, with all of them loosing and winning at somehow the same phase.

The expert advisor portfolio remains in profit, above the 10% profit threshold. With ichimoku5 and moneymaker trading the higher bulk of trades. I also noticed that the portfolio didn't go below the initial deposit of 10,000 which means that we may now be above our initial condition and heading towards steady profits.

This however, is sadly only speculation. Although this portfolio has managed to keep up, we still have several months of forwards testing before we can say "It works". As always the trading statement is available here.

Thursday, January 10, 2008

Doubleplay Live Trading Stopped !

This week I traded Doubleplay v 4.0 live. The results were what I would have expected for doubleplay. Hitting one stoploss and managing to get 3 small wins which amount to a small loss for my mini account (about 4 dollars). This of course, due to the fact that EUR/USD was ranging the whole time which I have found out through experience, is not a suitable scenario for Doubleplay.

The reason I have stopped Doubleplay's live trading is not because of the expert's performance but because of a flaw (I think) I found . Doubleplay started to open trades as soon as it closed another one. This should not happen as the dl function should delay further order openings for at least an hour. This according to the value at which dl is set, 3600.

I have emailed Hal and I hope he can tell me if there is something wrong with the coding of my personal ea or if this is a change made between v 3.5 and v 4.0. I hope I can resume live trading next week !

Pointbreak, Week 3, Ranging Market, Ouch !

Throughout all my Pointbreak reviews I have clearly stated that Pointbreak is a trend following expert advisor. It does extremely well in trending markets, always locking in profit when such a market setup occurs.

And then ranges happen. Pointbreak does very poorly in ranging markets as we would have expected from both the ea logic and the information given to us by the expert's creators. This week has been clearly very rangy in the EUR/USD pair and of course, Pointbreak has accumulated significant draw down. I have to say it does not surprise me as I had been warned before about the temporary draw down on this kind of market.

This week or weeks are likely to be an endurance test for this expert advisor. We will see how pointbreak handles ranging markets and we will see if it amounts to draw down below the 10% threshold which would be unacceptable for such conservative trading.

Well, the EUR/USD is mainly a trending pair so we will most likely see the ea come back to life when the pair starts trending again - which is by far - most of the time. As always you can check the trading statement here.

Tuesday, January 8, 2008

Gods Gift v 7c, A Free, Likely Profitable Expert Advisor

For the past two weeks I have searched relentlessly for a profitable free expert advisor to fill the void left by the free expert advisor portfolio I stopped trading.

As you may know, finding free profitable expert advisors is very difficult given the fact that they are many of them, with limited information on their workings and objective. At the end, I think I found a light at the end of the tunnel.

This expert advisor I found named Gods Gift v7c coded by Matt Edmonds seems to be the answer to my prayers. The way I discriminated this expert from the rest was by back testing. And yes, we all feel the same way about it (does not work very good, I know it) but it is nevertheless a tool to separate possibly profitable experts from unprofitable ones, not to say that every expert resulting profitable in back testing would be in forward testing.

The back testing results are very good. After optimizing some of the parameters associated with this expert, I managed to get, using Alpari data and 90% modelling quality, a maximum draw down below 10% with a relative draw down below 15%. All of this with a 50% yearly profit, back tested from December 2004 to January 2008. This I have to say, is exactly what I am looking for. The strategy tester report can be seen here.

The expert advisor finds its entries with the help of the Waddah Attar Explosion indicator coupled with Keltner Channels. You can see this in the image at the end of this post. The expert advisor seems to perform very well on the GBP/USD pair with the time frame making apparently no difference although the back testing report was done using the one hour time frame.

I like everything about this expert advisor. Fixed stop loss, trailing stop and apparently a low draw down with a modest profit on average each month. I have started to forward test it today and see how it does in the real market. Everything points out to this expert being profitable, let us hope it lives up to it's back testing results ! Wish me luck !

Why There is An Expert Advisor That Works

For the past six months I have been very intrigued by who and what drives the prices up and down in the forex market. It is quiet obvious that retail traders hold just a small portion of the cake while funds, banks, exporters, importers and the like hold a much bigger chunk.

I have also asked myself if this people drive prices in a mechanical way. Is it predictable ? One of the most important questions for retail traders. Can we predict the direction of the market ? Or more specifically, can we consistently predict the direction of the market ? The answer - I think - is a shade of yes.

Even though we all have different opinions on the technicals and fundamentals of currency pairs, we all know what we all expect. I mean, for example in the case of a non farm payrolls release, we all think it will be say 100k, then it is 70k, there will unmistakably be a hike in the EUR/USD pair. It is all not because 70k is "good" or "bad" for the economy - although this may be aligned in some cases - it is because the market goes either with or against main trader expectations. This drives the market and people react predictably to this news events.

In the case of more technical situations I think the same may apply. People are psychologically predisposed to certain patterns on charts. This makes their appearance constant. People are used to feeling certain emotions once they see certain changes in price on a currency, then they react the same way they have always done. They will always see trends, retracements, breakout patterns and similar graphical figures.

Although I may not demonstrate conclusively that prices are predictable by means of repeating market behavior I may speculate that the fact that the same people are trading the same currencies on the same charts creates some sort of very complex pattern inside their conduct. People who grasp this pattern are successful retail traders. People who don't, well, they are the other 90% if you know what I mean.

My analysis so far, predicts that there may be an expert advisor that works on all market conditions. This is because an expert may - unless psychological factors in trading change substantially because of an event - trade based on the "pattern" given by currencies through human behavior.

And even though I have no way to know the nature of this pattern or implement it mechanically I know it is there, hidden amongst the price. Waiting to be discovered. Not all experts are doomed to failure, some may get the key to our psychology .

Saturday, January 5, 2008

Pointbreak, Week 2, Action !

As I wrote last week, I have been amazed by the Pointbreak expert advisor. I quiet like it's ability to follow trends and the way it hedges, pyramids, closes, etc.

This week was a perfect example of Pointbreak's different closing techniques. The week found a lot of hesitation on the EUR/USD pair with a very rangy tendency. This of course, is not the ideal setup for Pointbreak which is a mainly trending expert advisor.

Finding itself in a somehow rangy market, Pointbreak has now many positions opened with a lot of draw down. Although actual draw down has not managed to go beyond 1.60% which is very good news for conservative traders like me.

You can also see the equity curve of Pointbreak which is somehow a pattern I have been able to find amongst profitable experts. Their equity curves are not like straight lines, sinusoidal waves or the like. The curves of profitable experts look a lot like an actual currency uptrend. They go up but retrace every now and then.

I have enjoyed watching Pointbreak a lot and I hope we have big trends the following weeks which will deeply contribute to Pointbreak's equity. Since I am mainly a contrarian trader, I do expect the EUR/USD to hit 1.5, which will involve a massive trend with juicy profits for this expert.

As always, you can get the current statement here.

Free Expert Advisor Portfolio 1, Week 5, The end

Earlier this week when I published the review for my other free expert advisor portfolio I still had hopes that this portfolio would remain in profit. Unfortunately the expert advisors succumbed to rough market conditions caused, perhaps, by the non farm payroll release this Friday.

I analyzed the results obtained so far quiet throughly. I noticed that all the expert advisors were quiet active, except myfxovereasy - which despite my every try - didn't start any trades whatsoever.

The other experts, Phoenix, Artificial Intelligenge, Binario and Framework, managed to get a 40% combined maximal draw down with actual losses that amount to about 20% of the account's balance.

I didn't like the way these experts traded together. They seemed to counteract each others moves excessively to the point that the equity curve looks like a sinusoidal wave. I have then stopped forward testing this expert portfolio as no one would ever want to trade a portfolio with a 40% draw down.

Also when evaluating their losses individually I saw that all of them sustained significant draw down, ergo, non of these experts seem to be profitable individually. The fact that they were together hindered their loosing capability quiet effectively, even though they didn't turn out profit as expected.

The final statement as always can be seen here.

Thursday, January 3, 2008

Free Expert Advisor Portfolio 2, Week 4, Profits are In !

Last week I was very disappointed with the performance of both of my free expert advisor portfolios with both of them reporting loses. I apologize for not making two separate posts - one for each portfolio - as I was busy with new year's eve, etc.

The first month has ended for the second expert advisor portfolio. The debuting experts being Ichimoku5, Moneymaker, ADXCrossTrader and UniversalMACross. The rest of the settings are available in earlier posts about this portfolio.

The credit goes primarily to Ichimoku5 and Moneymaker both contributing almost every trade. The UniversalMACross has done one trade, which took profit and the ADXCrossTrader has done almost 10 trades with most of them going out at breakeven and one of them taking a loss.

I was happily surprised when I saw that this portfolio has recovered all of it's draw down and is now hovering above a 10% profit. With a maximal draw down of 25% it is still not as bad as the first portfolio which has managed to get to a 40% maximal draw down (although it is in profit right now).

Personally I did not think that this expert portfolio would last this much, and much less, with a profit. I thought the experts would wipe out the account in a matter of days or maybe two weeks at best. I am glad to now know this not to be true. I am pleased to know that there may be a hope that combinations of free expert advisors might work.

We end a first month in profit, the statement, as always, can be viewed here.

Doubleplay v 4.0 expert advisor, Live Forward Testing

I have just started the forward testing of Doubleplay v 4.0 on one of my live accounts. I will rely solely on the trading made by Doubleplay to profit.

The account I am testing the expert on is a mini IBFX account so I have set the mini variable to true. I have kept all further settings at their default value with a 5% risk factor.

Since live testing results made by Hal himself and other traders (link at the bottom of the left column) have shown this expert to be profitable (and I have found Doubleplay v 3.5 to be profitable also) I find it reasonable to give this expert a chance in forward testing. As usual, statements and results will be commented weekly.

I hope this expert delivers as much as its predecessor !

Wednesday, January 2, 2008, A vps Review for Mt4 Expert Advisors

When we all get serious about using expert advisors for trading, one of our first absolute needs becomes finding a reliable vps. A vps or virtual private server is a computer server in which you load your metatrader program and your expert advisors, the server stays on almost all the time , having a 99,99% uptime is required for trading.

I searched a lot for a decent, cheap, reliable vps service. Finally, I found exactly what I was looking for. At, for the small price of 25 USD a month, you get a fully configurable and installed virtual private server. You can use enough RAM to load about 7 instances of metatrader while your expert advisors and your resources are limited to about 25% of the actual servers (which are quad core, dual processor, Xeons). This setup is so good, it was good enough for performing quantum chemical calculations which are very computationally demanding.

I have been with them for about 4 months and they have not disappointed me once. Their support is super quick and I have never had any downtime with my expert advisors (I use resources a lot with about 5 instances running all the time). I login using remote desktop which makes the vps just like your home computer.I also upload files using the ftp client and server filezilla (which I installed by myself).

I also never reboot my vps owing to the fact that this affects the performance of experts which rely on factors that are reset when metatrader is restarted. Overall I think this vps service is top notch, also a plus is that you do not need to purchase a domain name to open up your account and start your server. I would highly recommend vpsland to anyone out there who seriously considers trading using a virtual private server.

If you want to learn more about expert advisors you can run in your vps you can look at my expert advisor reviews which can be accessed from the drop down menu on the left sidebar. If you want to learn about expert advisor evaluation, why most commercial expert advisors fail and how you can start to profit using long term stable strategies please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

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