Three verification points to avoid mistakes when choosing FX products and indicators | What to check before buying: "Verification, Worst-case, Intervention range"
Conclusion (in advance):When choosing an FX tool,
① whether the content of the validation is disclosed,
② whether Worst (the worst result) is also shown,
③ whether it clearly states what the tool does and does not do,
please check these three points.
If a product does not meet these three criteria, it should be a consideration to refrain from purchasing.
Reasons I organized the verification points
I have 15 years of experience in FX, and for more than 10 years I was a losing trader.
I immediately lost 10,000 yen at the start, and afterward I kept buying information products, signal indicators, EAs, and expensive coaching, totaling over 3 million yen.
The trigger was a 29,800 yen forecasting tool.
Looking back, many of the products I bought showed only “winning moments.”
Why the signals appeared there and what kinds of tests they underwent were not written anywhere.
Verification Point ① Is the content of the validation disclosed
You cannot judge only by “win rate ○%.” What you should look at are the following four points.
- Validation period and the currency/asset being tested
- Number of trades (not too few)
- Whether fees and spreads are included in the conditions
- Whether results hold up when the validation criteria are changed
Verification Point ② Whether Worst (the worst result) is shown
Products that only show the Best results should be treated with caution.
If the maximum losing streak, maximum drawdown, and Profit factor (total profit ÷ total loss) are disclosed, you can plan risk management.
Verification Point ③ Whether the tool clearly states “what it does and what it does not do”
Words like “AI-powered” or “automatic” alone do not reveal actual operation. Please check the following.
- Whether signals are emitted after confirmation, or if they repaint or move later (repaint or not)
- Whether orders are automatic or semi-automatic, and who makes judgments
- Whether you can control the operation (on/off) yourself
FAQ
Q. If backtest numbers are good, is it safe?
A. No. Past validation does not guarantee future results. Use it to assess the validity of conditions and as a disclosure that includes Worst as well.
Q. What is repaint?
A. It is when past signals are rewritten later. Even if past charts look favorable, the same result may not occur in real time.
Q. What should beginners check first?
A. First, check whether Worst (maximum drawdown, maximum losing streak) is disclosed.
Q. If it is expensive, does that mean quality is high?
A. Price and quality are separate. I myself have been reassured by high price and failed. Decide based on the disclosed information.
In my case, how I turned these three points into a form
Subsequently, I validated line-trading based on daily OHLC and shifted from being a “buyer” to becoming the “one who validates.”
As examples of tools built on validation, there is “Gold Canon” for GOLD(XAUUSD) (shows Best/Worst and Profit factor in the statistics panel) and the “AI SuperNova Sign Pro,” which allows selecting the degree of intervention.
For details, see GoGoJyan. Note that the displayed numbers are from past simulations and display examples.
Disclaimer
This article is intended for general information and an introduction to the design philosophy of products, and does not promote specific methods, products, buying, or sales.
The content introduced in the text is based on past design cases and does not guarantee future results or profits.
Investment decisions should always be made at your own responsibility.