Monday, February 1, 2010

Forex Expert Advisors : The Primeval Expert Advisor, an Unbiased Review

While searching for automated trading systems released during the last few months I came across the Primeval Expert Advisor. Today's post will focus on the review of this automated trading system. I will go through the expert's website analyzing all the author's claims and I will compare them with the evidence provided. I will also analyze the trading statements shared by the author and I will tell you my opinion about the possible future profitability of the Primeval expert advisor trading system. In the end I will be able to use all this criteria to tell you whether or not I consider the Primeval expert advisor worth buying and testing.

The primeval expert advisor sales page starts with some of the most bold claims on the industry. The author claims that the EA was able to give more than 3,800 million dollars from a 10 thousand dollar deposit during the past 10 years. This person is being totally misleading as the expert advisor NEVER generated those profits in real life and the statement is just a LIE. It is very different to say that an EA generated some profit in simulation than to say that the profit was made in real life. Making these claims is absolutely misleading and obviously untruthful.

Going a little bit further down we see that indeed all the claims of profitability are based on backtests from the trading system. Furthermore, these backtests and the demo testing statement shown give us some very good hints about the way in which the EA actually trades. From the demo test you can see that the EA uses a very small take profit which clearly screams that backtests are expected to be plagued with one minute interpolation errors, the obvious reason why there is such a huge profitability in backtesting. Long story short, the backtests of this trading system are totally useless since they will inevitably favor profitable trades. It also does not help that the risk to reward ratio is 10:1 something which makes the statistical favoring of profitable trades by error much more significant. As I just said, this means that simulations are not accurate and CANNOT be used to make claims about the expert's profitability.

The fact that non of the simulations can be taken into account leaves us only with the possibility to use forward testing evidence to evaluate the EA. More over, the fact that the EA takes such small profits makes the use of demo accounts useless since the cost of the spread is very large when compared with the actual profitable trades taken by the system. For this reason it is very likely that live results of this trading system will be very different from demo tests Another reason why the evidence shown does not accurately depict how the expert would behave in a real live broker account.

An interesting point arises. The primeval expert advisor costs 500 USD, why won't the creator of the EA put up the profit of a single sale to open up a live account to run the EA and prove his claims ? Why doesn't the seller open even a small 100 USD micro account to test the EA live, on real data ? Why would you ever risk your money with a system the author does not even dare to use ?

For me it is obvious that there is absolutely no evidence to backup the authors claims and there is no absolute way in which this could be done besides the use of live testing to evaluate the EA under real trading conditions which include spread widening, slippage, requotes, etc. For these reasons I consider the Primeval expert advisor definitely NOT worth buying or testing. If the author is ever able to provide a year long live independently verified test, I will be absolutely thrilled to redo this review.

If you would like to know more about automated trading systems and how you can understand them and learn to trade them profitably with realistic profit and risk targets 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 !

1 comment:

Mark said...

best EA ever. Works like a charm. Behaves similar like FAPTurbo. And FAPTurbo has consistent results (see also www.4xproject.com, live trading).

It is expensive though, but it works.

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