• Registered: 2019-09-10
  • Posts: 15

Topic: Profit Protection

It has been 2 weeks I attached my first EA collection to a cent account. I notice that some strategies generated are quite poor in profit protection. Here is my data (total 535 complete trades)
------------------------------------------------------------------------------------------------
| Max Profit Recored  |  No of Trade that  | Average Loss  |  Total Loss  |
|                                    |    Hit Stop Loss    |  per trade(pip)  |   (pip)          |
-------------------------------------------------------------------------------------------------
|  >= 25 pips                |         31                  |    35.5                |   1100          |
|  >= 30 pips                |         21                  |    35.7                |   750            |
|  >= 35 pips                |         12                  |    34.9                |   419            |
|  >= 40 pips                |          6                   |    30.7                |   184            |
-------------------------------------------------------------------------------------------------

In my opinion, I will search for a break even EA and set the parameter to set SL to BE after 30 pips of profit. That EA has to be able to manage all trades after I attach it to an extra chart.

The other thing that I concern is I'm not sure is 30 pips enough for the price to breath. I use M5 chart data and Min SL 20, Max SL 50, Min TP 20, Max TP 200 when generating EA on Reactor.

Anyone has any idea to apply profit protection? Or just classify those strategies as bad strategies?

2 Reply by hannahis (edited by hannahis 2019-11-08 18:38:07)

  • Registered: 2010-11-18
  • Posts: 1,179

Re: Profit Protection

Hi Sean,

Do you mean that you use another additional EA to set your Break Even setting?  If yes, then do consider also adding Trailing as additional trade management tool.

30 pips is fairly good for some amount of breathing space if your EA has high/good entry accuracy (yet that depends on your overall trading strategy).

For a high entry accurate EA, 30 pips is enough room for normal ranging mode (may not be sufficient for highly volatile market).  Taking into consideration that you are using a 5min chart, with a reaction time of every 5min interval, a trailing EA will help your EA be more responsive to any sudden fluctuation.  Given a choice, I rather set a 30 pips trailing than a 30 pips Break Even cos one is static while the other is dynamic (trailing).  As the saying goes, let the Profit run, when you set trailing at 30 pips, you already lock in your "Break Even" but yet at the same time you allow your SL to be dynamic and let you take advantage of capturing any other additional profit along the way.


How to improve your existing Strategy further

1. Do use the Fxblue service to gather your trade performance metric.

2. Use the filter to view a) Entire strategy's performance or b) weekly performance, I use both methods.

3. Look at your weekly performance and understand the characteristics of your strategy, ie. is it a ranging EA or a breakout EA?  For example, if this week is a ranging week, I look at which are the top performance EA and I select these EA and use them as Preset Indicators to further improve/fine tune them.  If the trading week is a Breakout week, I select the top performing EA as Preset Indicators to further improve/fine tune them.  In this manner, I can distinctively develop 2 unique and diverse set of strategies for my overall portfolio management.

4.  Lastly, I also look at my overall (entire) performance to select the best overall strategies for the entire period as preset indicators (3 mths onwards etc).

So even if you think your list of collection is bad, you can still select from the list, those EA that are either (a) (b) or (c) below and set them as your Preset Indicators

a) The EA with the best overall performance

b) The EA with the highest number of trade and overall has a some net profit (cos this EA just need to add additional rule to filter out the bad trades to improve overall trade).

c) The EA according to market types, ie. ranging or breakout/trending EA.

Lastly, it's my own personal opinion, I would rather use 1min time chart than 5min time chart.  There again it really depends on what types of EA you are searching for and your trading preference.

Note: Attached is a trailing EA that I often use. 

Here is the link to the website with many different types of trailing EA for free http://www.kimiv.ru/index.php?option=co … t&id=4

Regards
Hannah

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  • zenoni
  • zenoni
  • Licensed Member
  • Offline
  • Registered: 2009-10-25
  • Posts: 339

Re: Profit Protection

Hi Hannah

you have made very good points. If you are using 1min charts then how did you solve the execution speed and latensy issues?

I have experienced that at least 5min timeframes require some external VPS etc., but it is still not best for the 1min timeframes.

4 Reply by hannahis (edited by hannahis 2019-11-08 18:33:56)

  • Registered: 2010-11-18
  • Posts: 1,179

Re: Profit Protection

zenoni wrote:

Hi Hannah

you have made very good points. If you are using 1min charts then how did you solve the execution speed and latensy issues?

I have experienced that at least 5min timeframes require some external VPS etc., but it is still not best for the 1min timeframes.

Sorry I don't use any VPS so I can't advise you on this. 

1 min time chart uses every 1min interval to look out for trading opportunities i.e. opening and closing execution.  Whereas the 5min time chart uses 5min interval but in terms of execution, I assume it is the same except that the 1min would execute 5 times more in a 5 min duration but in terms of how fast the EA will calculate and then make it's execution (in terms of EA's algo or coding issue), I would assume it is the same for all EA irregardless of time frame (please correct me if I'm wrong, I'm not good in such technical issues).

So in a nutshell, I would assume the difference between a 1min time chart and a 5 min time chart lies only in how frequent the EA will search for trading opportunities and not an issue on how fast it would execute in terms of hardware issues (I'm not sure whether is this what your question is directing at?, sorry if I miss understood your question).

Regards
Hannah