Recovery Factor 10 promises
to investors

The first numbers that jump out when choosing an EA are usually “net profit” or “win rate.” Phrases like “net profit over 10 million yen in backtests” or “win rate over 95%” are indeed common when browsing investment guides.

However, from the perspective of someone who develops EAs, net profit and win rate alone cannot measure the true strength of an EA. Net profit can be manipulated by initial margin settings, and win-rate–heavy EAs tend to rely on averaging down after a single loss.

In the backtests for Shoukinryu (2015–2026, about 11 years), what I valued most wasRecovery Factor (RF)RF9.95—what this figure means and why it is more reliable than Profit Factor (PF) will be explained this time using concrete formulas and industry comparisons.

The formula for Recovery Factor (RF) is simple.

In Shoukinryu, 2,507,755 yen net profit ÷ 252,302 yen max DD = RF9.95. It indicates how many times the profit stacks against the deepest trough (loss).

A higher RF means you generate more profit for the same risk. Conversely,an EA with large max DD and relatively little profit has a low RF—in other words, not commensurate with the risk.

PF (Profit Factor) is calculated as “Total Profit ÷ Total Loss.” If PF is 2.0, profits are twice losses. This is an important metric, but it has one weakness.

PF only looks at profit and loss efficiency. For example, even if you lose 50% of your margin at some point but end up with a profit, PF may be high. But for the operator, whether they can endure that trough is the issue.

RF directly evaluates “how much profit you obtain relative to the largest trough (maximum DD). An EA with high RF is one that has achieved substantial net profit despite a shallow trough. In other words,an EA that can keep going both mentally and financiallyto the end.

When examining RFs of gold-related EAs sold on GoGoJungle, patterns emerge.

Generally, RF for gold EAs is around 1–2. This means drawdown is about the same as profit, or at most double the profit. “Good” level is RF around 3–5, which places you in the top 20%.

Shoukinryu’s RF of 9.95 means it has built about 10x the maximum DD in net profit over 11 years. It can be said to have achieved about 5–10 times the results of a typical EA while enduring similar risk.

EAs with high RF share a common structure: they satisfy two conditions at once—maximize net profit while minimize maximum DD. Here is how Shoukinryu achieves this.

In particular, the effect of ATR-based dynamic averaging is significant: by widening the averaging grid when volatility is high, it prevents losses from compounding due to consecutive entries. This is the main reason max DD is kept to about 12%.

At the same time, the logic to take profits immediately once the total position net is positive ensures profits are cashized reliably. It structurally prevents the pattern of “holding on forever and giving back in the next drop.”

From a trader’s perspective, what does high RF mean practically?

If you endure the same DD risk for 11 years, RF differences lead to large gaps in final asset values. An EA with RF2 might reach around 2 million yen, while one with RF10 could approach 4 million yen.

This is why RF is touted as the most important metric for long-term asset formation. Short-term win rates or net profit figures may change with market conditions, but RF measures the fundamental ability to convert risk into profit over long time horizons, demonstrating reliability over time.

• RF = Net Profit ÷ Maximum DD; shows how many times profit was stacked for the same risk
• PF only looks at profit/loss efficiency; RF also evaluates “depth of DD”
• Typical gold EAs have RF about 1–2; RF 3–5 is considered good (top 20%)
• Shoukinryu’s RF 9.95 proves it has built profits about 10x the max DD over 11 years
• Three structures—ATR dynamic averaging, total-profit all-at-once take profit, and news filter—support RF
• In long-term asset formation, higher RF yields larger final assets under the same risk

※This article is for information provision and not investment solicitation. The performance results shown are past performance and do not guarantee future profits. FX/CFD trading involves risks. Please make investment decisions at your own responsibility.