Do You Still BUY EAs?

I think that this would be an interesting thread is to find out if you still buy EAs.

 

I personally don't anymore as most of them are phooey :P

 

So let's all be honest. Yes or No

I've given up on commercial EAs. None of them are even remotely profitable to the level worth risking the money for them.

 

If there is a good EA, it's private and isn't being shared.

The best hope we have is to develop our own strategies (or borrow someone else's) and see if they are profitable or not.

At this point in my exploration of EAs, I know I won't get a reliable EA unless I make it myself.

I also know that if I do make one that works consistantly, that I wouldn't dare share or sell it.

"GoodEA" is less likely to be shared

But I'm glad that sometimes finds goodEA

Hi silverngold,

 

My answer is a resounding "no"!

 

It's very tempting from looking at the power marketing to believe that the next commercial EA to come along is somehow different to the others, despite the hype, this is never the case. The problem is that an EA which performs consistently well over a long period will have lots of losers as well as winners and it won't be able to take a $500 account to $5,000 in a few weeks (not very impressive marketing here...) ;)

 

From what I've seen, virtually all commercial EAs fall into two camps (which I guess most of you have spotted by now lol):

 

1. Scalpers with tiny targets and huge stoplosses. This enables the seller to show impressive statements going back quite a long time with lots of winning trades, failing to mention that the one time you get stopped out is when you typically blow all your winnings built up over such a long time and normally your whole account too lol.

 

2. Grid-type EA's. These are quite often referred to as "martingale" EAs - however martingale is something even more sinister than your typical grid EA. True martingale EA's are like the inveterate gambler who has to keep doubling up on losers until all his cash is blown. Grid EA's can work for quite a while particularly in ranging makets - again helping the seller to provide impressive statements with lots of winning trades, however catch one of these on the wrong side of a trend and you find that you're sitting on a stack of trades with losses mounting rapidly. If the trend continues for a good while (which it will do several times a year), then your account will be no more.

 

In my view the EAs which are likely to work are ones which make our life as traders easier. For example, if you have a breakout system which would normally trigger trades at certain price levels when you're asleep, then writing an EA to enter these trades could be advantageous. You could add a stop and target and wake up in the morning to count your profits or mourn over your losses. Alternatively, you could set a safety stop on these trades and then manage the exit manually when you wake up. This is using an EA to help you trade more effectively rather than relying on an EA to churn out tons of cash for you every day with no effort required on your part.

 

The idea of your own "cash machine" running automatically day and night with no effort required from you is the big selling point. However, if it's so easy to take cash from the markets by running a simple program, why are there so many manual traders? After all, the hardest part of manual trading is instilling discipline, which is already supplied with an EA.

 

One of the key problems with developing a quality EA is the imposed inflexibility that we get because we have to program all trading logic. As a manual trader you have access to a lot more information (for example the "fuzzy" art of pattern recognition, or awareness of news etc.) than can be coded into an EA. When you are watching price action it's clearer to see how far retracements are likely to go, however with an EA, for example you would have to use a rigid trailing stop to protect your profits which will quite often take you out of really good trades before they've had time to mature properly.

 

I agree with Rio, that there are no doubt some good consistently performing EAs out there, though they'll remain well hidden.

Hi Guys,

 

Have you ever wondered why there is so many EAs?

If there has been one that made money why bother to develop another unless it would make more money in the same amount of time. So, we would have then 2 or 3 systems that would make everyone happy and rich. The only people who become rich are the guys who sell it. All the EAs websites look alike. The use the same template and wrap up another EAs with a twist and here you go - $99 less in your pocket. I assume that you test it first before running live (otherwise it is total disaster to your live account).

 

I have not seen a profitable EA in a long run yet? I do not dismiss them totally since there is always something good in a package (an indicator or a concept) that could be used in my system. This is the only reason I check them. Over the last 2 years I have tested a lot of them. All the claims of making money etc. ARE FALSE.

 

If I can share anything here with those who start trading is DO NOT EXPECT TO SETUP AN EA AND BECOME RICH. You need to build your own system. There are some EAs that are very intriguing e.g. Forex Insider Pro - http://indo-investasi.com/showthread.php/2665-Forex-Insider-Pro . Given proper filtering (ADX or Emas) and Time Frame it has a great potential to do be a successful EA.

 

Good Luck Guys !

I don't believe in EA's either. Doesn't nobody wonder why the big institutions still have mainly human traders at their desks despite investing millions into the development of automatic trading systems? The truth is their automatic systems underperfom the human traders though they have all the ressources and experts they need. I think it's a waste of time trying to programm EA's.

 

I see trading as a skill - it's not programmable.

Edited June 9, 2010 by sherlock

sherlock, I still hope that your assertion is wrong, by the way makes me wonder the fact that big institutions could invest millions into the development of automatic trading systems and they do not make it.... what's a cruel reality .... :-( so it would be really better that everybody switch off EAs and stop to waste time, nevertheless I still see some accounts on myfxbook with automatic trading systems that seems to make profits even in the long run, what a cruel mistery !!! ( obviously I mean only verified myfxbook accounts ).

@acosma

 

The big institutions do invest millions in their automatic trading departments. But it's a fact that still the human traders generate the most revenue. Otherwise the traders would have been replaced...

 

Why don't you see this as a hint and give up being focused on running a full automatic trading system and start to learn disrectionary trading instead. That's what I am doing and since I concentrate more on things that you can't programm (overall market picture, time of the day (very important), previous price action, upcoming economic reports, etc) I see light at the end of the tunnel.

sherlock, my opinion was not against your opinion. I agree with you that human traders generate the most revenue in The big institutions.

Hello, I agree that manual trading will give the most revenue; But I also believe that when you do not expect your account to be doubled every month, but over a period of a year, it is possible to find EA's that are able to do this job. It is a question of choosing the right money and risk management. When you look around in this forum, a lot of people are trading live with EA's that are freely available on this great forum.

I'd like to add a very important fact to what was already said. What is hard to realize is that Metatrader4 is a very limiting platform and often it is the obstacle stading between failure and success. Yes, it is free and does what most traders expect it to do. However, by design it executes the EA only when an incoming tick is received which is very limiting. In essence the program controls when you can make your calculations and enter/exit your trades. It is the analog of the police controlling your gas pedal in the car you drive. They can let you accelerate somewhat to move from lane to lane but only under their full control. Hopefully MT5 does away with this limitation and until then it seems that we have a steep climb ahead.

 

Cheers

One other thing.... I hope to hell nobody is scalping the EURCHF these days.

 

The best commercial EA I've seen out there so far is actually Forex Insider Pro. It is a trend follower that trades on the Daily charts.

It's far from perfect but it's a whole lot better than a lot of junk out there.

Rio, I don't think that Brokers want you to lose money, if so your account would be wiped out and no more profits for brokers, but maybe it's possible that they want that your balance stay always at the same level.... some wins and some loses, some wins and some loses ans so on... who knows that .... sometimes it seems to me that they have this type of control.....but maybe it's only my impression.

Why the heck would I consider buying EA's when I can get most of them at a huge discount (free) here :)

 

Actually I do own one EA - namely Forex Shocker, and unfortunately that has not been too profitble lately.

 

I now trade manually and actualy manage to make some pips. :P

One other thing.... I hope to hell nobody is scalping the EURCHF these days.

 

The best commercial EA I've seen out there so far is actually Forex Insider Pro. It is a trend follower that trades on the Daily charts.

It's far from perfect but it's a whole lot better than a lot of junk out there.

 

Hi Rio

Do you mean that about FIP?

I lived it once for some weeks but with bad results.

Also the backtests really put me off.

Are you live with it?

I believe there are good commercial EAs out there but more crooks (marketers) have made bad name for commercial EA market.

 

That is why we needed forum like this to share experience and, hopefully, to find the few gems among the trash. Hope the community will continue to share their experience with both good and trash EA.

 

To encourage good developers to make their EA commercial, please purchase the EA from them after it has helped you to make profit about twice the cost of the EA. If they do not get the sales, they would just stop making their EA commercially and eventually there will no good EA on sale.

I believe there are good commercial EAs out there but more crooks (marketers) have made bad name for commercial EA market.

 

That is why we needed forum like this to share experience and, hopefully, to find the few gems among the trash. Hope the community will continue to share their experience with both good and trash EA.

 

To encourage good developers to make their EA commercial, please purchase the EA from them after it has helped you to make profit about twice the cost of the EA. If they do not get the sales, they would just stop making their EA commercially and eventually there will no good EA on sale.

 

Amen to that.

I've come to a number of conclusions about EAs. Here's my list:-

 

1. Scalpers don't work (MT4 lets brokers cheat you there)

2. Larger stoplosses than take profits will eventually kill your account

3. Martingale will destroy you

4. Hedging works until it doesn't any more, then you suffer the same fate as martingale

5. A lot of EAs are scams with false marketing

6. Any EA that attempts to trade on the H1 and lower timeframes will eventually die

7. Brokers want you to lose money, which is why they sponsor these EA competitions (FRWC anyone?).

8. Anything Steinitz produces is s***

9. If anyone has a holy grail EA out there they are keeping it to themselves.

 

Only too true. If you had a holy grail ea would you keep it to yourself? To answer my own question - No, I would give it away. Who's it going to hurt?

I don't buy anymore EAs and rarely look at the ones posted, as most "new" is the same "old" just repackaged differently or slightly modified free EAs.

 

I have to agree with Rio and soundfx on most parts as most EAs are just crap.

 

Anything fully automated has very very high potential risks if anything goes wrong, like software glitches, platform crashes and even then all bugs are worked out it can't be immune to irregular market behavior by news or anything of that nature. Even banks who have very sophisticated automated trading systems, have full staff to monitor, tweak it and pull the plug if anything is wrong.

 

EAs can only be used as a tool or in a semi auto setup, but you need to monitor it quite frequently if you don't want any nasty surprises and pull the plug when needed. How many times many of you went to sleep with EA running only to wake up for some real hard truth? In short I haven't found or seen any EA with good profits to risk ratio, most risk a lot more for few pips profit, but hey equity curve looks smooth on backtesting:) I think instead of buying EAs it is best to try different trading rooms, signals, or systems as you have many more chances there.

 

As for brokers please get real, all huge bonuses they get it back either by you taking plenty of trades or simply trading against you. Most that give bonuses are market makers so they make the market to a degree and take opposite side of your trade, and by statistics 95% loose so that is a great way to make money for them. Haver you ever seen reputable and ECN brokers give huge bonuses? This would be almost like giving somebody free money to trade, no such thing.

I don't purchase EAs anymore since I came to knew this website!

hi there.i agree that manual systems have a future,EA's are history, none of about 100 ea's i tested cant be profitable in long term.

No.

 

Haven't used any since last year. All manual since then.

I'm not running anything live at the moment until I finish creating my own EA.

I used FIP for a while, but it started losing. It was a bit buggy. The slope line direction indicator often repainted and caused that EA a lot of pain.

 

Essentially, the only time periods worth trading are Daily and H4. That's the only way you can really fly above news reports, avoid stop outs, avoid market noise and weak signals, and avoid dodgy broker MT4 tricks. It also means that you need a lot of equity to handle a day or two of drawdown.

Edited June 14, 2010 by Rio