In my quest to find more commercial and free expert advisors I have stumbled upon the http://forex-expert-advisor.com website and it's range of automated trading systems and products. Given the fact that I had never seen their website or their expert advisors I decided to take a deeper look into them and analyze whether they are worth buying or not.
I have to say that I am extremely skeptical about any trading system whatsoever. Several years of experience have taught me that the world of forex expert advisor is filled with things that seem to work that really don't. When I arrived at the forex-expert-advisor website, my attitude was no different. The website has a sort of unclean look (in my opinion), something which is usually the mark of someone who does not have a very large budget for website development (or is very cheap).
When I started to see the expert advisors with the little "software box" drawings and the like I felt I was going to find some clearly unprofitable trading systems however I was surprise to find no cheesy marketing techniques, no testimonials, etc. The only thing that appeared to show where the expert advisor descriptions and the backtesting supporting information, no excessive publicity or hype it seems.
I then began to look into the backtesting results and the general trading mechanics of the expert advisors, to my surprise, the author was very cautious with the backtesting and the analysis of the software. All the experts seem to be backtested down to 1999 and some of them have several backtests showing the ea being profitable under several win to loss ratios, even when the take profit is larger than the stop loss. It is quiet hard to find profitable expert advisors with very low risk to reward ratios, when this happens it usually means that they tap into a fundamental quality of the market (e.j trend following).
However don't get too excited. The lack of general forward testing in the whole website seems a tad suspicious to me. Why would such a profitable, short term money making expert advisor author not show explicit forward or live testing of his experts ? Well, there can be several answers for this. Generally I would think that an ea with low risk to reward ratios and a TP and SL as high as 50 are not very prone to common errors in backtesting such as one minute interpolations, for me the suspicion arises because such a wide range of different setups are profitable. This could mean that the ea taps onto a backtester programming issue, such as using the close price of bars in order to trade (this often leads to those pretty equity curves, because of course you are trading knowing the future).
Well. in general, the expert advisors seem to deliver, at least in backtesting, and show linear, achievable equity curves (although with excesively low draw downs, something which also seems suspicious and may point to the explotation of a metatrader tester issue). Nonetheless, this could all be just me being excesively skeptical about these trading systems so I decided to contact the author and offer him an email interview so that he can better explain his systems and why there is such a lack of actual trading information. Once he gets back to me I'll write another post with his answers. Up until now, I would recommend you abstain from buying the expert advisors until we gather further information.
If you would like to learn more about other free and commercial expert advisors I have bought, tested and considered likely profitable 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 !
I have to say that I am extremely skeptical about any trading system whatsoever. Several years of experience have taught me that the world of forex expert advisor is filled with things that seem to work that really don't. When I arrived at the forex-expert-advisor website, my attitude was no different. The website has a sort of unclean look (in my opinion), something which is usually the mark of someone who does not have a very large budget for website development (or is very cheap).
When I started to see the expert advisors with the little "software box" drawings and the like I felt I was going to find some clearly unprofitable trading systems however I was surprise to find no cheesy marketing techniques, no testimonials, etc. The only thing that appeared to show where the expert advisor descriptions and the backtesting supporting information, no excessive publicity or hype it seems.
I then began to look into the backtesting results and the general trading mechanics of the expert advisors, to my surprise, the author was very cautious with the backtesting and the analysis of the software. All the experts seem to be backtested down to 1999 and some of them have several backtests showing the ea being profitable under several win to loss ratios, even when the take profit is larger than the stop loss. It is quiet hard to find profitable expert advisors with very low risk to reward ratios, when this happens it usually means that they tap into a fundamental quality of the market (e.j trend following).
However don't get too excited. The lack of general forward testing in the whole website seems a tad suspicious to me. Why would such a profitable, short term money making expert advisor author not show explicit forward or live testing of his experts ? Well, there can be several answers for this. Generally I would think that an ea with low risk to reward ratios and a TP and SL as high as 50 are not very prone to common errors in backtesting such as one minute interpolations, for me the suspicion arises because such a wide range of different setups are profitable. This could mean that the ea taps onto a backtester programming issue, such as using the close price of bars in order to trade (this often leads to those pretty equity curves, because of course you are trading knowing the future).
Well. in general, the expert advisors seem to deliver, at least in backtesting, and show linear, achievable equity curves (although with excesively low draw downs, something which also seems suspicious and may point to the explotation of a metatrader tester issue). Nonetheless, this could all be just me being excesively skeptical about these trading systems so I decided to contact the author and offer him an email interview so that he can better explain his systems and why there is such a lack of actual trading information. Once he gets back to me I'll write another post with his answers. Up until now, I would recommend you abstain from buying the expert advisors until we gather further information.
If you would like to learn more about other free and commercial expert advisors I have bought, tested and considered likely profitable 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 !
Posts
No comments:
Post a Comment