Escape EA - the 100% winner

> takes profit after 10 pips and stops loss at 1000 pips.

Thats the clue right there! So users beware!!

Also note that this is set for full-pips so all the pip specific values would need multiplying by 10 (inc Slippage) for sub-pip pairs/accounts

-BB-

BB, small profits and WIDE stop losses are the hallmark of EAs that have a phenomenal success record.

This philosophy flies in the face of traditional thinking, which is small losses and BIG profits.

Personally, I couldn't handle a 1000 pip stop loss for a 10 pip profit. But does that mean the philosophy has no merit?

Maybe all the books we read that talk about "cut your losses and let your profits run" are wrong?

The proof of the pudding is in the eating. An interesting analogy is the latest phenomenon in the poker game Texas Holdem.

This game is being played for multi-million dollar stakes and is currently being won by "math-brats" who don't respect the rules.

Established experts like Phil Helmuth with a record 11 WSP bracelets are going back to school to learn the math these brats are using.

What am I saying? A 1000 pip stop loss is like having NO stop loss. Phil Helmuth may be young enough to embrace the new math.

I am too old and I have survived with the rule of small losses and BIG profits too long to learn the new rules of the fancy EAs.

the question is: what do you prefer, to have many small damages or a deadly wound?

On my current chart of EURUSD D1, the most recent lowest low is 1.18752.

If you had gone long at 1.2875 on 5 May 2010, you would still be in the market today, by a whisker of 0.2 pips.

At the time of writing, the market is 1.25314 and going up. Every chance that you will make your profit target of 1.2885.

What a journey of more than two months to make 10 pips profit. But a profit is a profit, better than a loss.

So easy to do in back testing. But very difficult to do in real life.

You could also make your losses not so big. with for example a 5 pips win and 250 pips loss, you could afford to lose once every 50 wins, and 50 wins with this EA it's not even a day ! anyways I like this EA very much.

Also an idea that some might like : to decrease even more the chance of losing you can every losing 250 pips buy or sell the double of the losing lots. That is lets say you sell at X 0.1 lots, when the price is at X+250 you sell 0.2 lots, at X+500 you sell 0.4 lots, etc. I you can do this long enough, you will NEVER lose. This is the same algorithm as the one for 100% win for the roulette. It also gives you a bigger win area. I plan to write a EA that is based on this idea. Let me know what you think. Maybe somebody already did this.

Thank you.

Do not ever trust any experts
Never to control your investment experts do not
Never even the best experts the world
It is very, very dangerous

this is a great idea ! I don't know if you realize this :)

Helmuth, Brunson, et al literally wrote the book on poker math. There teachings are minimise your loses and only make positive EV plays. Don't chase odds that pot odds don't support. Daniel Negreunu once said "You are not really trying unless you fold the winning hand from time to time". Imho, the key difference of old school is they use physical reads to determine whether vilian is bluffing (as part of their odds calculations). The new breed, who play internet poker can't get physical tells so pay for it with aggressive betting. Helmuth, Brunson etc are not as skilled as internet players when it comes to fold equity and that's why they are less succesfull now.

Either way, both poker schools are acutely aware that winning is about long term expected value. Easy to calculate in a fixed universe of 52 cards and a player you can read. Not so easy in the market. Imho this EA cannot show that longterm it will achieve a minimum of 101 wins to 1 loss to be positive EV. Even if it does on backtest, there is no guarentee that tomorrows market universe will be the same as yesterdays so it's futile to even try. Feeling lucky to chase that gutshot, go right ahead, but know you will go bust if you do it without the right pot odds.

V

If you double up on your short position in the manner you suggest, where would you take your profit? At X-5 for all lots? Surely not.

The break-even is X initially, then (X + 2X + 2*250)/3 at point 2, then (3X + 500 + 4X + 4*500)/7 etc.

So you would take profit at break-even - 5 for all lots?

I think it's an interesting concept. Let me know when you have your EA ready for testing?

This is the type of Martingale systems I've been referring to. Are people so lazy that they cannot employ simple moving averages. There's NO Martingale system that beats Roulette so stop mis-leading the public. Some poor soul might read that and rush to the casino to make donations to the fat casino owners. I simply can't let that one slide. The math is pretty easy for your ea so why don't You write the ea and post the results of the back-tests here?