Forex Expert Advisors : DNAFx Trading, a Second Unbiased Review

A few days ago a visitor left a message on the website's chat telling me to redo my review of the DNAFx Trading system in virtue of its new back/live testing evidence which, according to the person who sent the message, is enough to consider changing my past opinion about this trading system. On today's post I am going to do a second review of the DNAFx trading expert advisor in virtue of its new trading evidence which I consider does grant it the possibility to change my previous opinion. Within the following paragraphs you will learn more about my views regarding the new evidence for this trading system as well as if the evidence presented is enough to consider the trading system worth buying and testing. I will also give my opinion about the system's like hood of long term profitability and the reliability of the evidence presented.

Within my previous review of this trading system I had said it was not worth buying or testing in virtue of the complete lack of live trading evidence and the unreliability and unverifiable character of the back testing evidence shown. Now, I have to say that the people behind DNAFx trading have done a good effort and have presented us with a live account linked to a myfxbook widget (showing third party investor access verification) for their expert advisor showing almost 5 months of live testing data. This period of live testing reveals that the trading mechanism of the expert advisor is what they describe with several very profitable trades (which seem to be breakout trades) and a larger yet much smaller number of loses which are typical of breakout systems between profitable periods.

Regarding the system's trading tactic I would have to say that from the live testing statement, the technique used seems to be sound and to follow the two of the most important premises of trading "let your profits run" and "the trend is your friend". The introduction of third party verified live tests which are updated frequently is a true compromise with their own trading system, definitely showing that they want to prove their system's capabilities fully.

However, the system's current profit of +50% with a draw down near 10% does show that the draw down/profit targets deducted from backtests are not accurate possibly due to the fact that backtests are run within the 15 minute timeframe a very inaccurate time frame to run backtests due to the small number of reference points when compared with larger time frames. As a matter of fact, the largest true modeling quality achievable with this timeframe is more around 60-70%. Of course, these problems can be made even worse depending on the trading strategy used reason why the profits seen in backtests are very overestimated, something which is obvious when you consider an 11000% profit with a mere 18% draw down.

I would say that the only thing that the people at DNAFX trading are missing to make a full evaluation of their system is back/live testing consistency analysis, that is, they need to provide a backtest of their live trading period to show if trades match and if simulations provide realistic expectations. Please understand that I am only interested in systems which are able to show the HIGHEST like hood of being profitable for the next 10-20 years and for this robustness through several market conditions MUST be proven, the only way to do this (besides 10 years of live testing) is with 10 year backtests coupled with back/live testing consistency analysis. If this information is not given then the likehood of long term profitability remains low.

Up until now, the people at DNAFX trading have been able to show that their system a) uses the trading tactic they say and b) has been profitable for the past 5 months. However they still lack a validation of their backtesting results meaning that there is actually no way in which we can currently evaluate if the system is able to adapt and survive changes in market conditions. The only thing missing is a backtest of the past 5 months so that live/back testing consistency can be evaluated. If backtesting consistency with live tests is not present, which I suspect would be the case due to the profit/risk figures of the backtest, use of 15 minute time frame, etc, then a live test of a few years would be needed to show the systems adaptability. If back/live testing consistency is present, then this system would have enough evidence to be considered worth buying and testing.

I would have to say that this system still does not satisfy my criteria for long term profitability in the sense that there is no backtest we can compare with live trading (tests within the same period). However these people are very close to providing all evidence necessary to consider the system to have high like hood of long term profitability. Please understand that there is a high responsability for me in recommending any trading system and I cannot recommend in good conscious a system which, even though showing live trading results, does not show conclusive evidence about the validity of the backtests and therefore the possibilities of the system to be long term profitable. (Remember that I am looking for LONG term profitable system, not systems that can merely provide proof of a 6 month testing period)

If anyone from DNAFx Trading is reading this, please provide a backtest of the same period as the live tests so that I can do a live/back testing consistency analysis and evaluate if the system does or does not provide evidence of LONG term profitability. Since this system is only missing this small (but absolutey VITAL) piece of evidence I will email the creators so that they can email me the tests or post them on their website. Meanwhile, I would have to say that I do not consider this system worth buying or testing until this evidence is provided due to the fact that the validity of the backtests (which allow us to evaluate LONG term performance) is missing.

If you would like to learn more about automated trading and how you too can design and trade your own long term profitable systems based in sound trading tactics please consider buying my ebook on automated trading or joining Asirikuy to receive all ebook purchase benefits, weekly updates, check the live accounts I am running with several expert advisors and get in the road towards long term success in the forex market using automated trading systems. I hope you enjoyed the article !

Forex Expert Advisors : Dnafxtrading an unbiased review - revised

On April 27, 2009 I wrote a review about the dnafxtrading expert advisor evaluating this trading system's main characteristics in order to say if it was worth buying or testing. At that moment, the expert advisor creator had too few live results and was not offering any conclusive tests that showed that his EA could trade anywhere near the trading performance we saw on backtesting.

After several months, I can write a second review for the dnafxtrading expert advisor stating what I know think about this trading system. As a matter of fact I am terribly dissappointed because this expert advisor seller just pulled out one of the oldest tricks on the book. After having some weeks of live testing results back in April, the EA creator now has only testing since June 2009 which also shows significant deviations from the behavior the expert shows on backtesting from what I can see.

Why did we have results in April 2009 and now we have only small portions of live testing ? Well, you don't have to be a genious to guess this one right, the expert advisor seller is just testing the expert until he has some profitable results to show and then most likely erases them when he or she starts to see some draw down on the account. This is one of the most unethical and misleading things EA sellers do but it clearly was done in this case as they did have live testing in April 2009, which has now dissappeared. The screenshot of the live results is also misleading as it does not match the live results followed through the link shown above them.

After this reevaluation of the dnafxtrading expert advisor, I can say without any fear or doubt whatsoever that the dnafxtrading ea is absolutely NOT worth buying since the EA creator has shown clearly that if I ever thought there was anything good with his trading system, it does not exist anymore. The expert's results are not consistent with it's backtesting and live testing information has been removed from their website, two definite signs that something is not right with this trading system. This expert now joins my almost endless list of totally worthless expert advisors.

A new review has been written to consider the new third-party verified live tests provided by the creators of the EA.

If you would like to learn more about automated trading, why commercial expert advisors fail all the time and how you can start building up a profitable return with free automated trading system with realistic profit and draw down 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 !

Forex Expert Advisors : dnafxtrading , an Unbiased Review

Usually I try to write reviews about products that are of interest to my website viewers and customers. I try to write about the expert advisors out there that people are most likely to come across and other products I consider to be good, etc. This time, I write this review because someone has spammed my website for the past 2 weeks to the point of making me specially angry. I really don't know if it is the dnafxtrading.com web master or simply someone who is extremely curious about this website but hey, I know spamming when I see it and this person was simply trying to get some links across to his or her website. Well, that person may now stop spamming my blog because I decided to write a review about the ea offered at the dnafxtrading.com website.

At first, this ea selling website does not seem as elaborate as most of the more commercial expert advisors. I mean, it seems like a programmer tried to market it, not a truly proffessional marketer who knows how to make people buy things (websites like fxkiller, fap turbo, forex funnel, are all evidently produced by proffessional marketers). So ok, the website does flash some absurdly high profit values like 50,000% since 2001, but ok, I always give expert advisors an opportunity regardless of what the creator has to say about them. I'll look at the trading statements myself and give my honest opinion about them.

First of all, the seller should not make claims of such high profits based only on backtesting reports. The seller should explicetely say that those results are per the backtesting that has been done, otherwise, people could be confused and imagine that these results are actually real. Now, as per the backtesting, the ea does include a stop loss, it does trade with orders separated more than 20 pips from the entry price and it also has average profits above the average losing trades. These are all positive signals for the expert's logic but still, backtests are done with the benefit of hindsight so they should not be taken in so lightly to evaluate an expert's profitability. People that have read my ebook on automated trading know that my criteria is far stricter and requires forward and live testing.

The creator does seem to provide live testing information updated in a live fashion but he or she fails to provide us with investor access information. How do we know that trades are in fact made by the ea and that the statements are not manipulated ? That would be the only way. But ok, if we assume that the seller is honest and we are looking and genuine trading results, they are still too few to consider the expert worth buying. Ok, the creator has posted live statements and that puts it in the "may be worth buying at some point" so we will let this ea run for at least one year before we decide if it's live trading is consistent with it's backtesting information and the software is in fact worth purchasing and worth trading. (this EA has been reevaluated and it's status is curently NOT worth buying, a revised review has been published in 04/08/2010 to consider third-party verified live tests provided by the creator)

If you would like to learn more about other commercial and free expert advisors I have tested and reviewed as well as more in depth information about how to choose an automated trading system 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 !