Multi System Portolio - Demo to Real

Hi all,

I created a 100k demo auto trade portfolio copying 12 traders (looking for return relative to drawdown with eggs in a few baskets) and just wanted to run my logic through and to have picked apart any unrealistic settings/logic.

I set the multiplier for each system to get the hypothetical drawdown to just under 5%(5k). Multipliers range from 0.13 to 1.1 and minimal balance from 1k to over 28k. I've let this run over a period and can see that the demo results may be in line with previous months real returns.

Do you think this is a good set up? The real question though, is what differences between demo and real can really affect this return? I've read in other threads that if expectation per trade is too small, it may be eaten up by an increase in spread (going from demo to real). Copy trade commission is also not included in demo results? What else should I consider?

Cheers

Hello,
You need also to consider the execution. Demo execution is what you see is what you get, but not on live trading. You will get so called slippage / price adjustment - depending of the order sizes. In most cases this would be negative for you, which means worst entry and exit prices. In some case you will have positive slippage, but not in the same size as negative.
Another point is entries or exits in gaps. They will be different on demo and live and this will have influence also over the final result.

Bottom line: the gaps most likely will be not so often and with such sizes that could affect strongly your strategy, but we have some events as : Brexit, France elections, Turkish referendum and etc. that needs to be considered. :)

Thanks Baldo, i understand negative slippage is inevitable, depending on which server i am on etc. I've looked at some of the trading results and there are some ridiculously large positive slippages which don't look right. There are a few other things that look potentially 'massaged' to create better looking results. its a bit of a mine field!

BaldoN posted:
Hello,
You need also to consider the execution. Demo execution is what you see is what you get, but not on live trading. You will get so called slippage / price adjustment - depending of the order sizes. In most cases this would be negative for you, which means worst entry and exit prices. In some case you will have positive slippage, but not in the same size as negative.
Another point is entries or exits in gaps. They will be different on demo and live and this will have influence also over the final result.

Bottom line: the gaps most likely will be not so often and with such sizes that could affect strongly your strategy, but we have some events as : Brexit, France elections, Turkish referendum and etc. that needs to be considered. :)

That’s really true! I have also similar experience! I see, maximum Forex brokers are providing different trading environment in my demo and their live trading! As an EA trader, I faced so many problems because of this issue! Like I found good result in demo, but with the same EA low revenue in live trading account!

ChenLipKeong posted:

BaldoN posted:
Hello,
You need also to consider the execution. Demo execution is what you see is what you get, but not on live trading. You will get so called slippage / price adjustment - depending of the order sizes. In most cases this would be negative for you, which means worst entry and exit prices. In some case you will have positive slippage, but not in the same size as negative.
Another point is entries or exits in gaps. They will be different on demo and live and this will have influence also over the final result.

Bottom line: the gaps most likely will be not so often and with such sizes that could affect strongly your strategy, but we have some events as : Brexit, France elections, Turkish referendum and etc. that needs to be considered. :)

That’s really true! I have also similar experience! I see, maximum Forex brokers are providing different trading environment in my demo and their live trading! As an EA trader, I faced so many problems because of this issue! Like I found good result in demo, but with the same EA low revenue in live trading account!

Yes but is that whenever you go from a demo account to a live you will see drastic changes in your way of trading. Of course it does not work the same.

It will have difference - this is with sure, but drastic may looks too much :)
It is up to the person and / or the EA if any.

There is a difference around news events but usually the demo and live are very similar

You could deal with some of these problems by trading longer term, but that's more geared towards stocks.