A small while ago there was a lot of hype about this new expert advisor called P.I.D SP4. People were getting mass returns on this expert advisor and so many more people began to converge on this ea and start to trade their capital using the expert.
I have to say, I warned them ! Expert advisors that offer mass returns on some months are very or more exactly extremely prone to lose all their money and even more. As I have said on an earlier post, in my experience, profitable consistent expert advisors seem to have at least a 30-40% draw down of every 10% consistent profit they get on the account. This is simply the balance demanded by the market and the reason why top fund managers almost never get more than 20% profits a year, they are extremely conservative because they know the inherent risk that comes with high profitability.
I never traded P.I.D myself but saw it trading on many friend's accounts. The results were just like I expected, this correlation based ea found a point of divergence and the whole account got wiped out. Then, a second version, P.I.D SP5 was released, which although promised to be much more stable than the ea before it, wiped the entire author's demo account less than a month after it's release. I don't think the author realized how dangerous and prone to catastrophe his strategy is by design and I don't think he purposefully deceived people into buying something he knew would fail. I think this was just a consequence of a lack of understanding of what the market demands for what the market gives. A consequence of trying to find a holy grail. If you would like to read more about profitable expert advisor, how to find them, etc, please buy my automated trading ebook or subscribe to my weekly newsletter were I analyze current experts I am testing each week (you also get investor access to live and demo accounts).
I have to say, I warned them ! Expert advisors that offer mass returns on some months are very or more exactly extremely prone to lose all their money and even more. As I have said on an earlier post, in my experience, profitable consistent expert advisors seem to have at least a 30-40% draw down of every 10% consistent profit they get on the account. This is simply the balance demanded by the market and the reason why top fund managers almost never get more than 20% profits a year, they are extremely conservative because they know the inherent risk that comes with high profitability.
I never traded P.I.D myself but saw it trading on many friend's accounts. The results were just like I expected, this correlation based ea found a point of divergence and the whole account got wiped out. Then, a second version, P.I.D SP5 was released, which although promised to be much more stable than the ea before it, wiped the entire author's demo account less than a month after it's release. I don't think the author realized how dangerous and prone to catastrophe his strategy is by design and I don't think he purposefully deceived people into buying something he knew would fail. I think this was just a consequence of a lack of understanding of what the market demands for what the market gives. A consequence of trying to find a holy grail. If you would like to read more about profitable expert advisor, how to find them, etc, please buy my automated trading ebook or subscribe to my weekly newsletter were I analyze current experts I am testing each week (you also get investor access to live and demo accounts).
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