Many EA review is very beautiful, once the real offer is suspended, it will be over. The main reasons are:
- The review time is not long enough or selective.
EA’s historical backtest:
To fully understand the performance and profitability of a foreign exchange EA, it is necessary to do a historical backtest of the EA.
Open the MT4 platform-smart trading test, select the smart trading system, product name, applicable date, time period, click “smart trading properties”, enter the starting capital and parameters, and click start to start the backtest. After the back test is over, click “Report”, right click and save as test report, you can see the detailed test report of EA. Through the test report, you can understand the EA’s detailed transaction records, profit ratio, maximum loss, and so on.
EA’s historical backtest
Everyone knows that for the amplification of the foreign exchange market, the market is analyzed year by year. It may be unilateral in a certain year or a certain year, or a certain year or a certain year, but it will not be unilateral or all fluctuations for more than ten consecutive years. . So many EAs will be produced based on the market that has been completed. For example, in 2008, the euro was a big unilateral rise of more than 3,000 points without turning back. If you use an EA that does unilateral trending to re-examine the market in 2008, usually It will run out very beautiful data, but once this EA is used in the shock market, it will show earth-shaking changes, and vice versa. If an EA can start from the day when the euro was born in 2001 to the current 15 consecutive years of data resumption in 2016, and still the capital curve is steadily rising, it can indicate that the EA strategy can basically be absorbed.
- Is it definitely possible to make money by using the EA mentioned above to list a firm offer? Not yet.
Real EA test: After the complete debugging and optimization of the EA, it is necessary to pass the real test to test the real effect of the EA. The real test can be through a demo account or a real account. The real test is different from the historical backtest. Because the future market conditions are unknown, the real test results can truly be an EA’s ability to adapt to the market.
EA real test
Because the historical replay is based on the network environment without any accidents, including delayed link disconnection and even crashes. In fact, during the on-hook for a year or longer, there may be a lot of bad network signals, server delays or even reconnection after disconnection.
Another more common phenomenon is that when the foreign exchange market fluctuates violently, it often rises or falls by a dozen points or more within a second. At this time, the trading software receives server instructions and executes orders or liquidation. If there is no time to do it, the trading conditions have been changed, then the order will not be placed or the position will not be closed, which will cause a large loss.
Therefore, a truly excellent EA must have excellent error correction and fault tolerance.
- Can EA that are both OK with the above two points can sit back and relax?
Still not working, stability determines success or failure. The stability mentioned here is not only the stability of hardware and software, but also the stability of strategy. How to understand it? A lot of mindless doubling EAs tend to be lucky, and may make a lot of profits in a year, and the recovery curve is also very beautiful, but the final 99.99% is the tragedy of liquidation.
There are also many trending EAs, which have been strong for two or three years and still stand tall, but the process is terrible. To give a simple example, an account with 10,000 US dollars may make as much as 50% a year, but in some of them In a month, the biggest floating loss may have lost 7,000 dollars, but it was lucky to meet a wave of big market and make it back.
So began to advocate how good the EA is. Just imagine if you are the owner of this account, will you still dare to face it calmly when the loss reaches more than 5000? What if you are unlucky and continue to lose money? The result is still liquidation. So it’s no different from gambling. To put it bluntly, you might as well just open an account and make a big deal, maybe you can earn 50% in a few days. Wouldn’t it be more enjoyable?
Finally, there is a trap that will be exposed. Many foreign exchange agents will list some so-called bullish EAs for customers for free. You will find that the main thing these EAs are doing is incessantly making orders, even small accounts with two thousand dollars. Can do as many hands in a day. But whether the account is profitable is not necessarily, it must be that the agent has already earned a lot of commission.