Alan’s Money Blog

Greetings fellow forex traders! How has the forex market been treating you lately? Making the big bucks? Good!

For the past 3 months I’ve been putting The Forex Autopilot System through its paces, and alas I think it is time to wrap up my performance testing. I would’ve continued the demo testing were it not for an upcoming trip to Europe which means that I’m going to have to shut down my PC. First let me say that playing around with this EA (expert advisor) has been really fun and being the owner of the previous forex autopilot expert advisors 8-pack I can say with confidence that this single and latest expert advisor is a major improvement - kudos to the forex autopilot crew.

Now let’s talk performance data. I’ve demo tested this EA on two demo accounts, one at North Finance and the other at InterbankFX. The one running at North Finance was setup to use the default settings while the one at InterbankFX was using my own custom settings (aaa = 9 bbb=10 TrailingStop=20 - the rest default.)

North Finance Demo Account Performance:

Click on the PDF icon to download the complete detailed performance statement

As you can see from that performance statement this EA did make some nice money, but it also lost big too. However, the account ended up with a net profit of $455 - not bad for a few months worth of trading. Now let’s look at how my custom settings did.

InterbankFX Demo Account Performance:

With this account I had a bit of a snafu and I accidentally deleted the cloned MetaTrader 4 folder recently so the statement cuts off at 2008-05-01, but that floating negative position had I not killed the account would’ve hit the take profit at 1.5650 (remember the EUR/USD is now at 1.5815) Here is the statement in PDF format:

My custom settings improved performance by a tiny bit. To be honest I have no idea what aaa & bbb really do. In the manual we are told not to mess with them, but since I’m a rebel I decided to do it anyways, and the end result wasn’t all that spectacular. Just to be safe I’d recommend that you stick to the defaults - at least on a live account.

What I like about the Forex Autopilot System EA:

a) It makes money!

b) It makes money!

c) Oh, did I mention it makes money?

What I do not like about the Forex Autopilot EA:

a) No stop loss by default! (danger Will Robinson, danger!)

b) Veeeery large negative floating positions - at times you’ll see this thing carry -400 pips floating loses before it eventually closes the trade with a profit of only 20 pips!

c) Trailing stop loss of 50? What the heck is the point of this? Maybe someone from the Forex Autopilot crew can enlighten me on the rationale behind this setting because I just don’t get it. Why would you set your trailing stop larger than the take profit? To me a more reasonable setting would be at 15 pips seeing as how the take profit is 20 pips.

The interesting thing to note is that if you give this EA a stop loss it starts to become unprofitable. The largest loss I’ve seen it sustain was around the $400 mark so maybe this EA has an internal stop loss? Perhaps this is done to thwart brokers who try to stop hunt (yes folks your broker can work against you). In either case the average max loss has been around the $100 to $400 mark.

The danger of having no stop loss is that if say for whatever reason your PC shuts off or something goes screwy and you can’t log into your account or whatever other calamity may happen your account is going to be going down the toilet. Granted this is not very probable but never say never - all it takes is for it to happen once!

So in light of this I’d recommend the following:

a) Get a battery backup for your PC and networking gear (dsl/cable modem) to ensure that in the worst case scenario if your power goes out for an extended period of time you at least can set a stop loss on a floating negative position and hope for the best (try setting it at a major support level)

OR better yet

b) Run this EA in a VPS (virtual private server) or “virtual computers” as they are often called. Your VPS provider will most likely have solid network connections and ample batter and diesel generator backup. Also they will most likely be running Windows Server 2003 or better which is far more reliable than your XP machine or whatever.

c) If you’re really really worried about the possible implications of having no stop loss - set one up! Just make sure you give the EA ample “breathing room” From my observations the largest loss I’ve seen has been in the -400 pips area, so setting a 500 to 600 pip stop loss may be best. This is absolutely insane in my opinion but hey it buys you peace of mind (hope you catch that subtle joke)

Another thing that intrigues me about this EA is the fact that it runs on the M1 time frame. I was taught to believe that the M1 time frame is full of nothing but market noise. How this EA manages to successfully trade on this time frame is beyond me. Can any forex guru weigh in on this and enlighten me?

Conclusion:

My final conclusion is that this product is not a scam or a pure garbage but it sure isn’t the holy grail either. It is somewhere in between as one should realistically expect. It does make money but it also loses it just as easily. According to my demo testing it appears that in the end it makes more than it loses, which is what counts in the end. The profit ratio is pretty high actually. On both my demo accounts the percentage of winning trades has been above the 90% mark - a very respectable achievement. The lack of a stop loss and the very large floating loses are two very big negative points against it. At times it looks as if it will lose all the profits it made previously with one trade.

Since past and present performance does not guarantee future success in the forex world, I’d have to give this EA a tentative recommendation. I’m just not 100% decided on this product. I’ll have to see how trading on a live account goes.

BUT I would STRONGLY suggest you take my advice and please make sure you DO NOT overleverage your account when using this EA - don’t get greedy or you’ll regret it.

When I get back from my vacation I will place this EA on an “expendable” mini live account at IBFX, so wish me luck!

By the way if you wish to discuss this EA and other forex related topics join me at my forum. Click here to read the thread dedicated to the Forex Autopilot System.

Well that about does it for my final review. I’ll clue you in on any other profitable expert advisors I may come across - be they commercial or freely available. I will most likely post them on my forex blog instead of here though.

The Forex Autopilot System homepage is available over here.

Thanks for your attention and for visiting my blog. Happy trading to you all!

Cheers,
Alan