5/19 Occasionally I borrow the power of ChatGPT, its number 99
FX Auto Trading, EA developer'sReiwa's Double-0.
Since last year, I've been aiming to post every day in this series.
I think I have managed to continue for about a year now!
If you read what I’ve written so far,
I believe you will come closer to better EA operation.
Also, there are times I’d like to take a break,
so I’ll continue posting with the help of ChatGPT.
Occasionally, I will post irregularly as in the past.
FX Auto Trading, EA developer's Reiwa's Double-0.
This time, I received a very interesting questionto share with everyone.
“Question contents”
Thank you for your help.
I want to choose an EA paying attention to the recovery factor in backtests.And if the win rate is good, I think any currency pair or time frame is fine.
Is this understanding correct?
Also, I plan to operate with just a single one first.
Are there any cautions?
And I’m unsure whether to use a passive approach or add discretion.
Also, I’m aiming for “1 million yen capital with 3 million yen monthly profit.”
Please tell me if there are any issues.
“Reiwa's Double-0 Answer”
First of all, it is wonderful that you are calculating the recovery factor yourself.
The recovery factor is indeed one of the evaluation metrics for an EA.
However, it is still “the result of past backtests,” and there is no guarantee that future markets will move in the same way as the past.
It would be good to treat it as a reference.
Personally, I recommend comparing forward results as well to judge.
Now, I will answer each point of your question.
About win rate
In evaluating an EA, focusing only on “win rate” is dangerous.
What matters is whether the balance between win rate and average profit and loss is good. Win rate also varies by EA type. For example:
Scalping typically around 70% win rate
Anomaly-type around 50%
Trend-following around 40%
Thus it varies.
Each EA has different characteristics, so understanding the win rate appropriate to its characteristics is important.
Single vs. Portfolio
Running an EA solo carries risk.
Generally, combining multiple EAs into a “portfolio” can provide diversification and make it easier to achieve stable results.
Running a single EA requires enduring temporary downturns, so caution is needed.
Advantages of passive operation
Passive operation allows the EA to perform its inherent performance more easily.
If you add discretion in a half-hearted way, especially beginners may see worse results.
However, during political events (elections, FOMC, etc.),
if you feel mentally unsettled, one option is to pause the EA during those periods.
Finding a style that suits you is important.
About funds and expected returns
Lastly, regarding the goal of “1 million yen with 300,000 yen monthly profit.”
Unfortunately, a 30% monthly return is extremely risky and difficult to achieve in FX.
In fact, even world-class hedge funds commonly target around 20% annual return.
As returns increase, so does risk.
In my past backtests, even pushing risk to extremes, 50% annual return was the limit in most cases.
So, rather than chasing excessive returns, I hope you aim for stable operation.
Summary
I have answered honestly to your questions.
FX requires very careful risk management, so I would be glad if you operate with calm judgment.
I will continue to strive to help everyone manage their assets!
So, happy trading continue!
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【Flow from Starting EA to Intermediate Level】
First, mastering **installing the EA** is important.
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MT4 EA (Expert Advisor) and Indicator Installation Procedures
https://www.gogojungle.co.jp/post/1/8212
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※GogoJungle Video Version※
At first, you won’t understand everything at once, and some people will struggle quite a bit.
Even I struggled many times at first, so don’t rush—you’ll be fine!
If you don’t understand something, there is a contact form, so use it!
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https://www.gogojungle.co.jp/inquiry
【How to choose an EA】
When you think you can operate an EA,
you may think, “I don’t know which EA is profitable… I don’t want to lose money…”
Therefore, Reiwa's Double-0 has published the following series to help you gauge performance through backtests.
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https://www.gogojungle.co.jp/finance/navi/series/1714
【How should EA risk management be done!?】
And no matter how capable an EA appears to be,
how to manage risk?
This is answered in the article below.
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■ “How to calculate risk management for EA”
https://www.gogojungle.co.jp/finance/navi/articles/64703
【EA operation mindset is also important】
And, sustaining EA operation for the long term also requires an “EA operation mindset.”
Regarding those articles,
12/30 Year-end and New Year SP!! EA full understanding course part 3
https://www.gogojungle.co.jp/finance/navi/articles/80551
8/12 [Obon holiday special企画!] Now you too can master EA! “Mindset for improving EA operation”
https://www.gogojungle.co.jp/finance/navi/articles/72829
8/17 [Obon holiday special企画!] Now you too can master EA! “Notes during EA operation”
https://www.gogojungle.co.jp/finance/navi/articles/73797
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With that said,
it's a substantial and quite important content,
so even if you cannot understand it right away, please make sure to read it!
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【Reiwa's Double-0 EA Listing】
https://www.gogojungle.co.jp/users/112481/products
Specifically, categorized EA listings for Reiwa's Double-0
https://www.gogojungle.co.jp/finance/navi/articles/67162
(Diversification by genre is essential when building a portfolio)
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【List of Reiwa's Double-0 Series Articles】
■ EA Beginner Course
https://www.gogojungle.co.jp/finance/navi/series/1700
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“About calculating EA risk management”
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
■ How to find winning EAs from backtests
https://www.gogojungle.co.jp/finance/navi/series/1714
■ No sugarcoating! GoGoJungle raises an issue!
https://www.gogojungle.co.jp/finance/navi/series/1701
https://www.gogojungle.co.jp/finance/navi/articles/64723
■ Reiwa's Double-0 “Push Status Buy/Return Sell Logic” is released!!
https://www.gogojungle.co.jp/finance/navi/articles/65010
https://www.gogojungle.co.jp/finance/navi/series/610
【Reiwa's Double-0’s Beliefs】
Develop EA with proper methods,
and gain wider support from people,
maintain a long-term WIN-WIN relationship,
aim to revitalize the EA market and improve literacy.
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