Monday, June 29, 2009

A Full Ebook Remake is on the Way ! :-)

Throughout my last year of forex trading I have changed many of my views and opinions on automated trading systems. Most of all, my views on how expert advisors should be tested and documented and how an expert advisor should be traded have also changed significantly. I have learned a lot about ea profitability and how one can truly earn an income from forex automated trading systems.

These new views are much wider and complete than the views I had when I wrote the first version of my automated trading ebook. I have also learned a lot more about what people need to know in order to trade with automated trading systems successfully and what questions I can answer with my experience to help them on this jouney. There have also been a lot of developments on the commercial ea arena and I have come to know the schemes and techniques used by the people that try to sell poorly tested systems a lot better.

With all this in mind, I decided it was time to redevelop my automated trading ebook from scratch to include all my new views about all the things I have mentioned before. I will try to make my ebook the ultimate guide for people that want to succeed in the world of automated trading systems, from how much money they need from how to distinguish between a good and a bad automated strategy and from a good and a bad money management system. My idea with this new version of the ebook is to benefit you, the regular forex retail trader, the most. I will include a lot of questions that people have sent me as well as a much more complete guide to the god's gift ATR system with detailed trading examples, logic examples, account examples, etc.

When will my new crown jewl be finished ? I am planning to have it ready by my birthday, July the 19th :). This will be the release date of this new and improved version of my automated trading ebook. It will be available for a little bit more than the current price, something around 19 to 20 USD. However, all of my current customers will be able to download this version for free (as I have always said). Hopefully most of my website visitors and current customers will greatly benefit from this new milestone in my forex trading career.

Sunday, June 28, 2009

Commercial Experts, Stealing from the Free Zone ?

There has always been a very serious issue in automated trading that deals with the use of free material by expert advisor sellers to create commercial expert advisors they then sell online. In the following post I will try to address this very serious and delicate issue and tell you how deep it actually is.

From time to time I have read on the internet about the use of free material found in forums by automated system creators to make systems they then sell on ebay or on websites for a nice profit. Of course, on several cases there hasn't been anything but a rumor but on others there has been a certainty of proof with at least a decompiled version of the commercial ea and the source of the free expert that shows a total match. Most of you may think that this is enough to blame a commercial expert advisor creator of copying free material for it´s use in a commercial product but the truth is that this is not enough. Was the expert really copied by the seller or was it copied by someone in a forum after decompiling the commercial ea ?

Who really holds onto the truth ? It is very difficult to really charge a commercial ea seller with theft because the date in which the expert became available online and the date in which the seller began to offer the product are often not so easily found. The ea seller may be a victim or he may well be the perpetrator of a crime. It is therefore really difficult to know the truth and to really know if the ea seller is being honest or if he is trying to get away with your money for something you might have found online for free.

Now, if every expert advisor out there for which I know there is a free equivalent would be taken as a theft from the ea seller then we could say that this issue is dramatically frequent, even a common thing in today's metatrader 4 automated trading world.

My advice ? Do your homework. It is very easy for an expert advisor seller to get away with this kind of theft if you are unaware that what he is selling has an exact equivalent of something found on the free market. Most of the time these expert advisor sellers lack a correct understanding of the expert's logic and most of the time they only find experts that have good backtesting and try to sell them with this scarce evidence. Again, as I have said many times, never buy something that is not being tested on live accounts and that have an investor password to access the testing. These expert advisors are really hard to find but that is for a very good reason Finding a long term profitable system is no easy task.

If you would like to learn more about free and commercial expert advisors I have tested and reviewed 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!

Thursday, June 25, 2009

The God's Gift ATR, Turning a Good EA into a bad one !

I knew it was only a matter of time before the regular forex crowd took a hold of my god's gift ATR expert advisor. For the past few months I have seen an outdated version of my ea appear on several websites and forums and inevitably, they have started to test the system as they test all other forex expert advisors out there. I really think it's a pity. The reason why I keep the ea to myself and my customers is because I think that a certain degree of knowledge is required to trade this expert advisor and I like to serve as a guide to the people that buy my ebook or subscribe to my newsletter in order for them to use the system correctly. Below I point out the main differences between how I use the ea and how others have been testing it in order for you to know what the big differences in trading are :

How I use the system :
  • I forward tested the gods gift 7c logic for 14 months before placing it on any live account
  • I then programmed the gods gift ATR, backtested it on 15 different currency pairs
  • I found out which ones the ea worked with and optimized them from Dec 1999 to Dec 2008.
  • I made several risk projections to ensure that the ea would trade as safely as possible on live accounts.
  • I then run these settings on four separate live accounts, two different sets of settings for the EUR/USD one for the GBP/USD and one for the USD/JPY.
  • I tested the experts on a realiable vps with triple redundant internet connection and made the investor passwords available as well as an ftp with regularly updated results to my newsletter subscribers.
  • I trade through draw down and profit and have confirmed several times the consistency I get between live and backtesting results.
  • I wrote a manual to further help people understand what goes on under the hood
  • I started the God's Gift ATR challenge to include controlled third party results into the expert's history.
How people are now testing it on forums :
  • They don't do proper backtesting and optimization from 1999, the few that do use just the last year or last few months, this extremely curve fits the ea.
  • Most of them don't have the slightest idea of how this system works
  • They don't do any risk analysis and just trade it to "see what happens"
  • Sometimes they trade it on more than 5 currency pairs on the same account (this by all means is a sure way to wipe the account)(I only trade one per account ! for very good reasons)
  • They trade it on all pairs with the same settings, without any preoptimization. They also test the ea on some pairs for which I know for certain the ea is NOT long term profitable, sometimes not even short term at all.
  • They run an outdated version of the ea which they adapted to use five digit brokers but in doing so they corrupted the ATR money management and market order size logics (again, they seem to lack of an understanding of how the system works)
As you can see, the great differences between how I test the ea and how it gets tested in forums is just too great. Inevitably, they will conlude that the ea is unprofitable eventually because they are trading it the wrong way. Why don't I start posting in forums and share all my results for free with everyone and help them succeed ? I am not interested in that. People that go to forums are sometimes arrogant and unwilling to change their mind sets about expert advisors and automated trading. They want you to explain everything to them and somehow, make them profitable in forex trading. I am not interested in fighting with people about how this should be tested or traded, etc. This is why I never asked the forum Administrator to remove the god's gift atr when this outdated version was posted on a forum a few months ago, because I know that even if the ea is out there for everyone, only one out of ten thousand will be able to find the settings and trade it the correct way and with enough discipline.

For this reason, as I outlined before, I just keep the god's gift ATR ea and testing to those people that are commited enough to read my posts, make a very small purchase and change the way in which they think about automated trading systems. Automated trading requires effort, requires knowledge and most of all, it requires commitment, something which I feel the crowd that is looking for everything on a silver plate fail to have. As you see, people at forums can turn perfectly good systems into terrible ones just by being totally irresponsible and incoherent with their testing. Why in the world would they test the ea on several currency pairs at the same time on the same account ? and all of them with the same settings ? I don't know. It is just a consequence of them not knowing what they are doing.

The worst thing about this is that they may get a month or two of profits and someone, somewhere will run that on a live account and lose money because of the irresponsability of the people that test these systems just for the sake of it. In order to test a trading system you must understand what it does and how it does it best, it is not about throwing the system into testing as you see fit.

If you are interested in learning more about the god's gift atr 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!

Wednesday, June 24, 2009

The God's Gift ATR Challenge, Testing by Third Parties

One of the great challenges of any automated trading system out there is to be robust, reliable and profitable. Since I want the god's gift ATR expert advisor to become the most well documented expert advisor out there I have decided to take several steps to make this automated trading system's characteristics very well documented, examined and tested. For me, an expert advisor that is truly long term profitable should fulfill a small set of characteristics that demonstrate its capacities :
  • Trading Platform Independence
  • Broker Independence
  • Extensive Live Testing (1 year at least)
  • Third Party Live testing
Since up until now all tests on this ea have been done by me (one year of forward testing of the main strategy plus 4 months of live testing on 4 different live accounts) I have decided to ask some of my newsletter subscribers to participate in what I have called "the god's gift ATR challenge". What I seek with this challenge is to have third parties test the expert advisor on live accounts under agreed conditions that guarantee that the ea testing is well done and comparable to my personal tests. The use of different brokers, different vps providers and money amounts should provide us with a wide amount of information about this expert's profitability. The people participating on this challenge are aware that past performance does not guarantee future results and they do this testing under their own free will with no promise of profitability. They run the ea on personal live accounts to which I only have read-only passwords. However the people running the tests must fulfill some conditions :
  • Expert advisor must be run 24/7 on a reliable vps provider
  • Expert must be run alone on a live account with a minimum of 100 USD (10,000 contract) or 1000 USD (100,000 contract)
  • A read-only investor password MUST be provided
  • The ea must be run for at least 2 years, regardless of performance (people must agree to do this or their testing will not be taken into account)
  • Settings, currency pairs and timeframe are to be provided by me and cannot in anyway be changed by the third party if results are to be comparable
If you are participating on the God's Gift ATR challenge please make sure you fulfill the above requirements and then send me an email. Please include your read-only password as well as the contract size of the account you are running, broker, account size and one of this three risk levels : Conservative, Moderate or Agressive. I will then send you settings as well as metatrader publisher instructions so that your results can be updated live to my ftp so that we can all share the test results.

Up until now more than 5 people have expressed a strong interest in doing this testing so if everything goes as planned, in a year from now we will have extensive reliable testing about this expert advisor and we will learn a lot about how it trades, how robust it is against market conditions changing and how we can improve it.

If you would like to learn more about this and other expert advisors I have tested and reviewed 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

Tuesday, June 23, 2009

Forex Expert Advisor : Neuros Ninja Sharp Shooter Unbiased Review

For the past several months I have received several requests for a review about neuros ninja sharp shooter expert advisor. I wanted to wait until I had enough information about the system in order to write a solid opinion about it, now I feel I have studied the system and the web page enough to give my honest and unbiased opinion about the expert advisor.

The website greets you with what I would consider a fair looking website with no excessive marketing or hype about the expert advisor. The website describes the expert advisers without going into excessive details. It says that the expert advisors are able to adapt to changing market conditions by the use of neural networks and it does a good amount of emphasis on the fact that the ea requires no monitoring or optimization.

Well, after reading the system's descriptions I was ready to look at the testing information that should backup their claims. Now, they say that their company has been trading the metatrader 4 system since 2006 and that they haven't had to change the expert advisors since then. Why in the world don't they have a 3 year old live testing statement that can show they have done so and can show that their system has remained profitable for all that time ? The reason is pretty simple, it probably has not.

When you look at the expert advisor's backtesting statements it becomes very clear that the expert does not have a very robust trading strategy. The system has a very narrow take profit which leads to very high interpolation errors in backtesting, the reason why the backtesting statement seems so profitable. Again, as with many more commercial systems out there, the expert advisor has a very high risk to reward ratio, something which is another clear sign that the backtesting results are misleading at best.

In my opinion, due to the reasons outlined in the above paragraphs I consider that neuros expert advisors are NOT worth buying and that the absence of live testing statements after 3 years is a big enough reason to suspect the profitability of the systems. The validity of the backtesting statements is also very questionable due to the small take profit of the expert advisor. In order to be even considerable for testing and buying the creators should show us at least a year of live trading, they fail to do so, again, even though they claim they have been trading these experts since 2006.

If you would like to learn more about other commercial and free expert advisors I have tested and reviewed 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 !

Monday, June 22, 2009

Forex Expert Advisor : Forex Derivative Unbiased Review

The objective of this post is, yet again, to review another system suggested by one of my website visitors. In fact, several people have come to show an interest on this system. The expert advisor I am talking about right now is the Forex Derivative Expert Advisor. This ea has caught several people's attention because of it's supposedly mathematically advanced trading system that changes according to different market conditions and allows the system to adapt as the market changes.

When you enter the website, the first impression you get is that this expert advisor will turn out to be just ike all the other commercial expert advisors out there. The website is filled with the usual, hype, commentary and testimonials commercial expert advisors of this type usually have. The website goes on and on about how the creator managed to put all his trading strategies into a single trading system, yatta, yatta. Truth be told, I am no longer interested in how the expert advisor creators were able to develop their systems, I am interested in conclusive proof about the expert's profitability and for sure, I am very interested in accurate descriptions of their trading methods.

Now, as far as evidence goes, the forex derivative expert advisor is no surprise. The website has the usual backtesting with an almost 2 month old "live" testing statement shown on their website. In my opinion, no live teting results can be trusted unless one has access to the account via an investor read only password. Why ? Because results can be manipulated and not be the result of mere automated trading, if we can get access to the account we can in fact verify that all trades are performed by the automated trading system. We can also verify that the expert adviosr is being run 24/7 and that the statement on the website is not simply removed when the ea wipes an account.

The trading strategy also seems to have quiet a few problems. The system has a risk to reward ratio which is almost 4:1 that is, you require almost 4 wins to recover from one single losing trade. Most trading systems with such unfavorable risk to reward ratios usually lose money in the forex market. The fact that the live account is also trading several currencies also makes it incomparable with the backtesting statement shown on the website. For the sake of consistency, the creators of the ea should have traded the ea with exactly the same parameters as the backtest, on a single currency pair.

Who knows if the forex derivative expert advisor really has all the market adapting features it says on their website. Up until now, they lack any testing information that may make their expert advisor's claims acceptable. They claim the ea is able to adapt to changing market conditions but they barely have 2 months of live testing. Are you kidding me ? One thing is to program something you think makes the expert adapt to several market conditions and another thing is that it in fact does it. If a system has not been traded live for a period of at least a year it is very hard to say that it can "trade all market conditions" even so, I would not dare say that about a trading system until I have at least 2 or even more, 10 years of live testing.

For the reasons said above, the forex derivative expert advisor is NOT worth buying because the authors do NOT have enough testing information as to backup their claims. If they ever have more than one year of live testing I will rewrite this review with new comments on the system. If you would like to learn more about other commercial and free expert advisors 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 !

Sunday, June 21, 2009

Trading more or trading less ?

I decided to write this post because there is something that has always puzzled me in the world of forex trading and particularly in the world of forex automated trading systems. Why do people like and prefer trading systems that trade more often ? I have always found out that people are repulsed by systems that trade infrequently and they often like systems that are in the market more time and tend to open positions with much more frequency. To me, this has always been totally absurd and in the following paragraphs I am going to explain the reasons why.

Ok. So why do systems that trade frequently are in fact worse ? Mainly for two reasons. For one, systems tat trade frequently are paying a lot more in comissions. If you enter the market ten times a day you are paying 10 times the spread in broker comissions while a system that just enters one time a week would pay a lot less. Second, systems that enter the market frequently are often entering the market on lower probability trades. The market moves more or less randomly from the 1 hour and lesser timeframes so in order to get good signals on the one hour, for example, you need to take into a account either a large number of periods or have very robust volatility filters. If you do this, your number of trades automatically gets cut down. So in my opinion, there aren't simply enough high probability opportunities in the market to trade everyday, sometimes there aren't even enough opportunities to enter once every week.

Why do people prefer these systems then ? My best guess (which comes from talking to several new traders out there) is that people like, again, instant gratification. The fact that they can see a system trade and start putting money into their accounts rapidly gives them peace of mind, so to speak. They are more worried about getting resuts that same day from a system they just purchased that waiting a lot to enter high probability trades in order to have a long term profitable trading system. Ergo, they like systems that trade a lot because of their ignorance (no offense) . They pay much more comissions, have a much higher market exposure but they get to see their expert trade almost as soon as they purchased it. For me, this is another reason why people lose their money with automated trading system.

I am not saying that a system that trades infrequently is necessarily profitable (I have seen a few that are not) but all profitable systems I know usually never take more than 1 or 2 trades per week, sometimes even 10 trades a year, while I don't know a single profitable trading system that takes more than 1 trade per day. It is just a matter of probability, trade more and you pay more comissions and get lower probability trades. It is not about entering the market, it is about taking very long profitable trades with the highest possible probability. It is about taking the few good opportunities that come out.

If you would like to learn more about commercial and free expert advisors I have tested and traded as well as the god's gift ATR expert adviosr 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 !

Saturday, June 20, 2009

You think your expert advisor is profitable ? Profitable, may not mean Profitable

Of all the misconceptions out there about automated trading systems and the way they should be tested and traded one of the worst ones is the misconception about expert advisor profitability. This is the reason why most people fail to use expert advisor solutions effectively and the real reason why most of these people lose their money with forex automated trading systems. In an article I wrote a small while ago, I exposed the reasons why the current way in which expert advisors are tested does not work, and does not do anything to show you the real potential and profitability of an expert advisor.

What do we call a profitable expert advisor ? This is the first question that most people have when they start trading the forex market and the reason most of them fail to find profitable expert advisors is because the intuitive definition of a profitable expert advisor is flawed. Intuitively, you would say that a profitable expert advisor is an expert advisor that makes money. That is an oversimplified definition of the matter. Sure, making money is a necessary conditions, but it is not everything you need to call a system profitable. A system can make money and be unprofitable. The same way in which a trader can make one thousand dollars one day and wipe the account the next.

There are several examples of expert advisors that make money and then wipe accounts, systems which can take even a year or two to do so. For example, every Martingale system out there will eventually wipe your account because the market exposure of the system is increased exponentially. Systems with high risk to reward ratios show you the same thing. A system that you can forward and live test for a few months, even a year with good results, then your account is wiped out. So here we come to the same point. The mere results of forward or live testing are no guarantee of profitability because the system itself must have a logic that targets an inner characteristic of the market.

Most people also reject profitable systems, a reason why I include the god's gift ATR ea with my ebook and my newsletter subscription. Most people would just trash a system that they live test for three months and takes mostly loses. Why ? Because people want instant gratification and they do not want to run something that takes all those loses, they simply do not understand the logic of the system and the reason why these draw down periods exist. Later they would find out the system came out of the draw down and made 3 times more in profit during one later month. This is the same reason why the creator of the turtle system said he could publish his rules on the newspaper and nobody would trade his system. Profitable mechanical systems are hard to follow and require your in depth understanding of the logic if you really want to feel comfortable with them. Most systems out there will give you your instant gratification, they will trade a lot, start to fill your account with money and then wipe it all. They are the absolute opposite of a long term profitable trading system, they use market randomness not market logic as a way to profit.

You guessed right, in order to learn which systems have long term profitable logic and which ones do not, you would need to know the codes, now how to program and now the strategy inside in and inside out. It could not be that easy right ? you thought that by running a program made by some other guy you could earn a living without working ? Come on. If it was that easy would anyone out there work a 9 to 5 job ?

If you would like to learn more about commercial and free automated trading systems I have tested and reviewed 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 !

Tuesday, June 16, 2009

So... What is your edge in forex trading ?

I have always wondered if people are really aware at how difficult to trade the forex market actually is. Most of the time people seem to know that the foreign exchange is a place where most people lose their money but they seem to be a little bit away from the concept. Most people consider this does not apply to them. Now, the truth is that most people lose money in the market, specially the foreign exchange market and certainly there is a lot you have to do if you want to become one of the few that can actually profit from this beast in a regular basis. There are a few things that make this more complicated, something which I wanted to point out so that people really become aware of what they are going against.

1. Your competition is not retarded : This is a very important aspect that most traders seem to neglect. They often belive that most people that lose money out there are just ignorant people who don't know what they are doing in the forex market and lose every penny on their accounts due to them not knowing how to trade. Wrong. Of course, this people lose their money too, but most people trading the market are not so ignorant and often, know much more than the new retail trader. Some people out there who lose are economist and finance specialists, so knowlgedge perse is not a way to win in the forex market, experience is very important. I would say, experience and knowledge go hand in hand and both have extreme importance. So don't think you know better if you have not been trading for at least 10 years. It is very difficult to have an edge this way.

2. Your competition wants to win : Most people also neglect that their competition wants that money as hard as they do. If they want to belong to the top traders that take money frequently from the market they have to wonder what they can do to win in their own game. These traders have been taken money from the market for years, even decades, and they are not alone. They are usually teams of very trained proffessionals and experienced retail traders that just want that money as much or much more than you. So what is your edge against them ? Cause I am certain they have plenty of edge against you.

3. Trading a commercial Expert Advisor is NOT an edge : Why would you have an edge if you trade FAP turbo, a system that has been bought and is traded by about 30,000 people ? Thats right, that simply does not give you an edge because it is a tool many many traders are using to try to profit against the market and market eficiency most likely prevents this from happening. Since the trading system is mechanical and automated, it is easily overrun by top forex traders around the world. Sincerely, honestly, do you think that using something you do not understand and many other thousands use gives you an edge ? It simply doesn't, thats probably the truth. They also know how to google, and they too know the program exists and why not to trade it. As I said earlier, your competition is not retarded, every obvious thing you can do to profit, is already taken into account and it won't make you profitable.

4. Automated Trading Systems Need to be Understood to Consitute an Edge : Ok, trading an expert advisor everyone can get their hands into and trade and that is highly commercially hyped won't give you any edge. But that does not mean that automated systems cannot constitute an advantage. If you trade an automated system that exploits a genuine characteristic of the market and you truly understand the way this expert advisor works, then the expert can give you an edge against every trader out there losing money with a commercial EA. The system most be robust, be able to change against different market conditions and you must understand it's code and the way it works, from A to Z.

5. You need to know Manual and Automated Trading for Automated Trading to be an Edge (probably programming too) : Yes, sorry to disappoint everyone out there, but if it was as easy as running a program made by Joe X and watching the money flow into your pockets then everybody would do it, right ? As I have said many times, being profitable with automated trading system is even HARDER than being profitable with manual trading systems because long term profitability in automated trading not only requires the regular knowledge of the market a successful forex trader has but it requires knowledge about which systems can be automated, what can really work, how to program the expert, how to debug, how to address the profitability of a system to know if it is long term profitable, etc. If you are just hopping to run an EA and become a millionaire, please, do NOT waste your time, you will only lose money with that attitude in the long run.

I hope this few parameters shine a little light into how hard the forex market really is and how you too can build your edge around a solid automated trading system. If you would like to learn more about ea profitability and automated trading, as well as expert advisors I have tested and reviewed 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 !

Monday, June 8, 2009

Testing Every Expert Advisor, The WRONG Strategy !

Throughout the last year, I have seen several new expert advisor review sites come out to test the many new commercial expert advisors released every. I have to say that despite the good intentions of most of these review sites and the honesty and effort done by their creators, most of them have a totally wrong focus in the testing and evaluation of forex automated trading systems. In my opinion, the successful testing and use of automated operation systems has to be done with the expert's logic taken into account and most if not all of these review sites totally neglect looking at the logic of the different expert advisors.

Their testing logic usually consists of taking a commercial expert advisor, (regardless of it's logic) and testing or trading the strategies, putting them to the test on either a demo or live account. The consequences of this is that a lot of effort is put on testing expert advisors which have a logic which is inherently flawed and designed for short term profits. In fact, there is the danger of making people act on short term results (which are sometimes very profitable) and make them risk their money on that expert advisor without even knowing the logic behind it or if it has the actual potential to be a long term stable profitable trading system.

In my mind, this is the totally wrong way to evaluate expert advisors. Not every expert advisor out there should be tested to prove or disprove its profitability. In fact, almost 9 out of every 10 expert advisors out there can be discarded in virtue of their trading logic. Moreover, the true trust and knowledge needed to trade with an expert advisor truly does not come from testing information but from knowing the expert's logic and having the confidence to trade the system even through periods of draw down. As I have said in a few posts, in order to trade with an automated trading system you require even more knowledge than the one you need to trade manually because not only do you need to know how to evaluate trading strategies but you also need to know which ones work in an automated environment and which ones do not.

The mere testing of the experts out there will NOT let you know which ones are long term profitable, which ones are prone to wipe your account and which ones are not. For example, martingale strategies can give you profit for even a year, then wipe all your profits and your whole account in few trades. If you want to learn more about how to identify long term profitable expert advisors as well as free and commercial expert advisors I have tested and reviewed 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 !Justificar a ambos lados

Sunday, June 7, 2009

Forex Expert Advisors : FxProMaker Unbiased Review

Another one of my expert advisor subscribers suggested that I review the fxpromaker expert advisor. Truth be told, I had already been pointed towards that expert advisor but I had abstained myself from writing a review about it because I wanted to wait for more live test information to be published on their website. Now I feel that I have enough information about this expert advisor as to write a solid opinion about it and it's trading.

The fxpromaker website is quiet clean cut, no marketing videos, pictures of cars, champagne or mansions. This is a good start. You are greeted with a simple menu that let's you choose between the performance, the expert advisor list and another few things. When you access the performance link you get access to a lot of live testing done on these expert advisors. Up until now, I was very happy with what I was looking at. You saw a website that aims at real forex traders and you see a lot of live results that tell you how each one of these experts has done in real life. Now, after I looked into the strategy of each one of the experts I started to have goose bumps.

Well, the main problem with the fxpromaker expert advisors is that the experts are martingales, that is, they double lot sizes after each loss. So the problem is that you end up risking a lot of money, just to make a little. For example, if you start to trade with 0.01 lots to make 5 USD, after just 5 loses you are risking more than 2000 USD to make that same 5 USD. That is, truth be told, quiet silly. If you ask any trader out there, non of them would risk 2000 USD to be 5 USD on the positive side again. I have a very strict policy not to trade martingales because they ALL eventually blow accounts up. Sure, there can be a period of even 5 years in which they work but trust me, no one, has ever made a fortune trading a martingale strategy in forex (or in a casino for that matter).

So what about all that live testing ? The truth is that most martingale strategies work, just until they don't and that don't usually means your account being brought to ruins by the expert advisor (a fellow reviewer, duyduy, tested this ea, it wiped the account within the first two months). Another thing is that we do not have live account investor access to the live testing so they might as well be fake results.

I would say that this ea fails to provide a strategy I can trust and for that reason I would not trade it like I do with other experts, in fact, I would consider it not worth even buying. I have seen several martingales that have performed well, in live accounts, for periods of even 1 year, only to see them crash and burn eventually. This ea is also remarkably similar to the freely available blessing ea, another reason why I would not purchase this ea. For all those out there trying martingale strategies, please stop, they did not work in the wild west, they did not work in vegas casinos and they do not work in the forex market.

If you would like to learn more about other free and commercial expert advisors I have traded, tested and reviewed 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 !

Saturday, June 6, 2009

Forex Expert Advisors : MatrixNN unbiased review

Since I am always looking for new expert advisors out there I am always very eager to listen to any suggestions any of my newsletter subscribers may have. Several days ago one of my subscribers talked to me about the MatrixNN expert advisor asking me to check it out and tell him what I thought about it. I answered telling him that I would write a review about the expert advisor, so here it is, my unbiased opinion about the MatrixNN expert advisors.

Well, at least, the matrixnn expert advisor's website seems to be quiet polished and well done. It is also worth noting that there are no videos or excessive marketing on the website something which I value a lot since most commercial expert advisors seem to have a very excessive amount of marketing. At first glance, the matrixnn expert advisor seems to be aimed at someone who more or less knows the forex market and have an idea of what an expert advisor is.

Now, the expert advisors themselves were a big dissapointment. The expert advisors do not have any live or demo tests (except for Matrix v4.0). The only conclusion you can arrive at when this happens is that the expert advisors fail to replicate the results they show on backtests. This is absolutely no suprise to me since the expert advisors seem to have a very classic and wrong trading approach. The expert advisors, as most commercial experts out there, seems to be based on short term profitability. The expert advisor has an exceedingly large risk to reward ratio of about 10:1. This is of course a sign that the ea will not be able to replicate it's backtests on a live account since this is what happens all the time (in my experience) with experts that follow this type of logic.

It is obviously not a coincidence that all succesful forex traders I know never trade with a risk to reward ratio higher than 1:2. As I have said many times, these expert advisors that have large risk to reward ratios are most likely doomed to fail. In order to prove the contrary, an expert advisor seller should at least provide us with at least a year long live testing with investor password access. Again, if you are reading this and you are or would like to become an ea seller, please, do not insult our intelligence and do not be so unethical to sell us something that is obviously not proven enough. Of course, for all the above reasons, the MatrixNN expert advisors are NOT worth buying. As far as Matrix V.40 goes, if the ea creator is able to put a live account investor access that verifies that live trading results are real and not fabricated I would be glad to reconsider my opinion about that expert advisor (athough I still consider the logic to be very weak and is almost certainly going to blow up eventually, a very good reason why there aren't any live tests for the other experts ?)

If you would like to learn more about my criteria for expert advisor choosing as well as other free and commercial expert advisors I have reviewed 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 !

Friday, June 5, 2009

Forex Expert Advisors : Forex Espionage Unbiased Review

A few days ago I received an email talking about the forex espionage expert advisor. Of course, the purpose of all these emails I get is to make me click through the affiliate links and buy the expert advisors. What I do most of the time is review the products instead so that people can know my opinion about most new expert advisors (I try to review as many as my time schedule allows me to). If you have read many of my reviews the truth is that I very rarely consider an expert advisor worth buying.

Well, I must confess that the forex espionage expert advisor is really not the exception. I can see the marketing all over it like on most commercial expert advisors out there. The website greets you with a video of a guy who obviousy treats you like you don't know a thing about forex trading or automated trading systems. The video and the website features many claims about profits, backtesting and as always the promise to free you from your 9 to 5 job.

Ok, so what is the validity of their claims ? They have many problems to start with. First, most of their claims are based on backtesting statements which we know are done with the benefit of hindsight so absolutely no validity there. They also show us some very limited "live" testing information which has no live account investor access and is truly excesively limited to pass any judgement about the expert advisor. If you are a commercial expert advisor seller or an expert advisor reviewer that lives from the affiliate links please have this in mind : don't treat your customers like their retarded !

The forex espionage expert advisors seems to be your average commercial expert advisor that aims at trading many times per day with several short term wins and incredible backtesting results but fails to work in the long term (the only thing that grows in the long term is the number of wiped accounts). The creators never mention the problems associated with backtesting and limited live testing results. They just want to convince you to use something even if there is no evidence that the system works in the long run and there is also no evidence that the live testings shown are actually real. Again, we need live accounts with investor access to believe the claims of ANY commercial expert adviosr seller.

In summary, not only do I find the forex espionage expert advisor NOT worth buying, I also consider their website misleading and offensive to the intelligence of any potential customer. Expert advisor sellers not only should show more realiable testing, they should also struggle to explain every possible mistake within the tests they are doing.

If you would like to learn more about how to evaluate and choose expert advisor as well as about other expert advisors I have traded and reviewed 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 !

Daniel Fernandez's Expert Author Email Alerts
Sign up to receive email alerts of Daniel Fernandez’s latest articles from!

Email Address: