Challenge automated trading using MT4!! Get started! EA Life | Episode 5: How to combine EAs [Masao Kakizawa]

Shizawa Masanobu Profile

Kizawa Masanobu. Since 2009, he has been developing automated FX trading systems and has provided numerous automated trading systems to securities companies and users, starting with EasySniper and MultiAgent. At Invast Securities’ automated trading service "Sistore 24," the provided strategy MultiAgent achieved an overwhelming performance and evaluation in the 2016 annual awards. Additionally, at Himawari Securities’ automated trading service "EcoTore," the provided strategy "Hikae Venus" maintained the No. 1 number of users for over more than a year from 2013 to 2014. The user base exceeds 700. He is currently offering Dream Agent FX, an evolution of MultiAgent.

In this series, we focus on FX automated trading systems, specifically Expert Advisors (EA) that operate on MetaTrader 4 (MT4), and will have professional trader Shizawa Masanobu guide you through knowledge and know-how for operating them. If you are considering operating an EA, as well as if you are already using an EA, please refer to this.

Note: This article is a reproduction and re-editing of an article from FX攻略.com October 2018 issue. Please note that the market information stated in the text may differ from the current market.

Need to tailor to market conditions

Hello everyone. We began the series "Let's Start! EA Life" in the June 2018 issue, and this is already the fifth installment. Last time, under the title "How to choose an EA," we explained how to read EA performance and how to evaluate it. While it’s easy to focus on profitability, we emphasized that you should pay more attention to drawdown as you continue operating.

This time, under the topic "How to combine EAs," we would like to discuss how you should combine EAs for automated trading operations. Some readers may wonder, "Do you even need to combine EAs in the first place?" or "Wouldn't you just use the best-performing EA depending on the moment?" Others may think, "Once an EA is running, you should keep using the same one forever."

First, to answer the question, "Should you keep using the same EA once it starts running?" an EA is an automated trading system that incorporates a specific trading logic. Since it is a "specific trading logic," it generally does not adapt its trading logic on its own and will continue the same trading pattern in any situation.

In a somewhat roundabout way, the bottom line is that an EA has a preset market environment assumption and a trading logic designed to fit that assumption. Therefore, if the assumed market conditions change, the EA may not perform as desired. Consequently, you basically need to use different EAs that fit the current market conditions.