Have you ever continued compounding for 10 years (with ★)?
FX Auto Trading, EA developer'sReiwa’s Double-Ee.
There is something called compound interest operation in the world.
If you operate EA and your performance is on an upward trend,
your assets increase by the amount of profit from the initial capital,
and you reinvest that increased amount into investments,
that is, the lot size also increases,
and the speed of asset growth accelerates further,
which is a system praised even by Einstein,
and many EA with built-in automatic compounding functionality.
For some people,
they reinvest the funds grown with EA into long-term stocks,
aiming for future solid and stable operation, FIRE.
In such a situation,
have you ever used the same EA for 10 years with compounding?
I think most people have not.
Rather, you might not be using the same EA for a year or two.
Compound interest is a wonderful mechanism, but
for example, if you run 1 million for 10 years, it could become hundreds of millions,
tests like backtests show calculations like that,
it's a dream, but it takes 10 years.
Therefore,
first, use the same EA for 1 year or 2 years or more of that period,
as a near-term goal, perhaps that is what you should aim for.
To do that,
find an EA that you can keep using for 1 year, 2 years, or longer, even 5 years or more,
and cultivate discernment for EAs.
Furthermore,
whether in a demo account or a real account,
there are few EAs with forward history of 5 years or more.
If that is the case,
even if you are about to operate an EA,
you may have to judge whether it can be used for more than 5 years by only looking at forward data.
Moreover,
after 5 years, market conditions can change drastically.
Considering that,
even looking at forwards within 5 years may not cover all market regimes,
and it could be said so.
Then,
in backtests, although not real trading,
you can find backtests of 10, 15, 20 years or more.
In terms of duration, they are longer than forward tests,
and you can see whether they performed well across various market conditions and key economic indicators,
and whether they performed well even when subjected to such rough seas?
By looking at that,
you can become skilled at evaluating EAs from backtests,
which is a strong advantage when choosing EAs.
That is why
I write about backtest evaluation methods across various media.
If you read those,
you are more likely to find an EA that can be used for a long period,
and accordingly, compounding can occur
and the rate of asset growth may increase.
Therefore,
it is better to be able to evaluate EAs by backtest than not to be able to,
and that is what I think.
In the first place, EA developers verify the quality of their devised logic by
backtests.
Among those, outstanding EAs are offered for sale.
Even so,
I think it is better to be able to evaluate EAs in backtests than not,
and that is what I think.
Articles on backtest evaluation methods are posted here.
--------------------------------
■ How to find winning EAs from backtests
https://www.gogojungle.co.jp/finance/navi/series/1714
----------------------------------
We hope it will be helpful to you!
Well then!
━━━━━━━━━━━━━━━
【Reiwa’s Double-Ee EA Listing】
https://www.gogojungle.co.jp/users/112481/products
Specifically categorized Reiwa’s Double-E EA genres
https://www.gogojungle.co.jp/finance/navi/articles/67162
━━━━━━━━━━━━━━━
【Reiwa’s Double-Ee Serialized Articles】
■ EA Beginner’s Course
https://www.gogojungle.co.jp/finance/navi/series/1700
--------------------------------
https://www.gogojungle.co.jp/finance/navi/articles/64703
https://www.gogojungle.co.jp/finance/navi/articles/65978
https://www.gogojungle.co.jp/finance/navi/articles/64738
https://www.gogojungle.co.jp/finance/navi/articles/65619
https://www.gogojungle.co.jp/finance/navi/series/1714
https://www.gogojungle.co.jp/finance/navi/series/1701
https://www.gogojungle.co.jp/finance/navi/articles/64723
https://www.gogojungle.co.jp/finance/navi/articles/65010
https://www.gogojungle.co.jp/finance/navi/series/610
【Reiwa’s Double-E’s Beliefs】
