How to Indentify the Efficiency of EA Program Trading

With the marketing developing for so long, there are all kinds of techniques and signals.

For many years, I have seen friends telling me that they traded with a certain signal and suffered from great losses or even being wiped out.

As a result, many traders in the market are afraid and suspectable about signals.

Meanwhile, they envy those who earn a good profit.

So, I will tell you how to identify.

1. Fund Disk

The forex market is a mixed back filled with genuine and false information.

The fund disk is one of which.

 

How to identify a fund disk:

Many people see the transaction records of others and feel very envious and admired, and also want to cooperate with them.

1. Many fund disks always advertise on the keeping the principal as their biggest selling point, but also many people’s pain point.

Forex trading is a high-leverage product. In this market, talking about preserving the principal is total bullshit.

Think about the UBS incident in 2015, even the platform blew up, not to mention the traders. The reason that so many big institutions dare not to promise about the principal is that this high leveraged product contains huge uncertainty.

2. Many platforms of the fund disk are under little to none surveillance. Few platforms can pass the normality test.

For these fund disks, their trading accounts might look good, but their platforms are non-mainstream.

Why? Because these trading records are modified backstage.

If you find a very nice-looking trading account, you can check whether he/she can provide another trading account on the mainstream trading platform.

Mainstream here means the platforms you often see on the market.

It is actually easy to judge the techniques of fund disks. The only thing matters is the reference objects. So, many fund disks are unable to provide trading records on other platforms.

 

2. EA Trading Techniques

There is a number of EA on the market and many people studying the program trading.

Some people bragging about how intelligent and lucrative their program trading is.

In fact, it’s all bullshit.

EA trading is nothing about advanced technology, seriously, it’s just a tool.

As for AI, so many technical giants haven’t fully understood it yet, not to mention to apply it in our industry.

In addition, the market is unpredictable. Nothing can judge the future for sure.

All EAs are merely algorithmic logics.

So how to identify whether this technique is good or not?

 

3. Looking at the trading history

Time will tell whether a strategy is good or bad.

Look at the trading time of the account.

It’s best the continuous trading history of an account last over 1 year.

Why 1 year?

Because in a year, there can be a lot of different situations which are a great test for the strategy.

If it survives, at least it means the strategy is stable and the risk to follow is relatively manageable.

 

Is three months enough to test a strategy?

No. Because the market situation has ups and downs and there are all kinds of possibilities.

 

The first three months might be very peaceful and then in the fourth month, you can still blow out.

Three months are a bump, half a year is a test, and one year is a cycle.

Many strategies cannot survive half a year.

 

4. Look for extreme market situations in the account’s trading history

Considering the quality of a strategy should look at the extremes.

Why extremes? Because it is the time that the account is most likely to blow out.

Even though you survived a month, one day’s extreme situation can clear it off.

This is also the feeling many people have when using strategies.

To test the strategy, you have to look at whether the account is trading during extreme conditions.

In extreme market conditions, the singularity of the strategy at that time, the situation of floating losses. This way you can have a rough grasp of the strategy.

 

5. Prevent fraudulent account records

The market demand drives people to cheat.

As a result, there will be a lot of fake accounts, because people are greedy, and when they see a lot of accounts are very violent, they want to follow.

Fake accounts have several characteristics.

1. Profiteering

2. Radical

3.High accuracy

Sure there are masters in the market, but very few can be so stable and steady.

Not to mention when they investment heavily and the result is still stable. This goes against the trading rules and normally won’t happen.

We must first identify-counter-trading technologies.

To put it simply, it is to use multiple accounts to carry out reverse transactions, creating a high accuracy and profit.

However, this kind of account is very aggressive in the early stage, then the order becomes small in the later stage, and even continues to lose money.

How to identify:

Look at the deposits: Counter trading needs money, and the remaining funds after the liquidation of other small accounts need to be transferred out, so you will see a lot of fragmented deposit and withdrawal records in history.

Looking at trading orders: We can see that the entry and exit times of trading orders in the account are almost the same. This is not in line with the laws of trading. There is little time difference between multiple orders, and little difference in cost. The time to close a position is also basically in a time period, so this must be a reverse transaction.

Look at the late stage of the transaction: the early stage of the transaction is very fierce, the late stage of the transaction is flat, the capital curve rises straight in the early stage, and the later stage is flat.

 

Above are some of my experiences on how to identify and select a trading signal. I hope it can be helpful and saves you from being tricked.