Acutally you can have the best of both worlds. I like to have a EA that will tell me when a certain condition exists. For example, say I want the stochastic to be above 80 before I will look at a possible trade. I code the EA to monitor the market, and it sends me an email, that I route to my phone as a text message, when the stochastic closes above 80. That way I can go about my business, and when the conditions are right, I can go back to the computer and decide if I want to place the trade. That way I am not glued to the computer, waiting. It also helps by not spending so much time staring at the charts that I talk myself into trades that I should'nt ever get into.
So my point is, that an EA can be whatever you want it to be, sure, it can trade for you, but it doesn't have to to be usfull. It can be another tool in the trading toolbox.

I totally agree as it is personality based. If you are a control freak, you would never give up anything. If you are a person with vision and wisdom, you know that 2 heads are better than one. If you have a company, would you prefer 1 employee (you), or 6 employees (you plus 5 trading systems). This way you can go to the beach, and still racking in the $$$. If you create a proper infrastructure, you company can run without you being there 24/7.

Think of a good EA as an employee, you have good months and bad months. You don't fire an employee based on a single bad month of performance. I did not create just one EA so that I can put all my egg in one basket. I created 5 EAs with low correlation so that I can diversify and reduce my risk. I look the results based on the net portfolio performance and not at individual EA. It is similar to looking at the big picture and don't micro manage.

My advice on trading with EA: 1) use multiple EAs 2) reset your expectation i.e. 35% per year not 2,000% 3) don't compound your trading lot size 4) don't buy the $98 EA - if it really works why would they sell you for that price.

ECMartin posted:
    
winsor posted:
3) don't compound your trading lot size

Why would someone not compound it? Yeah, your risk does decrease if you don't compound, but so does your % profit. IMHO if you trust your EA enough, compounding shouldn't be an issue (unless it's some crazy martingale/no stoploss strategy)


Have you heard of a forex trader who compounded his trading account and became an multimillionaire in a few years? If you do, let me know. Compounding is used by scam artists to suck people into trading or to sign up with their trading courses. You probably heard of Warren Buffett who took 30 years to become a billionaire. Rome was not built in one day.

winsor posted:
    
ECMartin posted:
    
winsor posted:
3) don't compound your trading lot size

Why would someone not compound it? Yeah, your risk does decrease if you don't compound, but so does your % profit. IMHO if you trust your EA enough, compounding shouldn't be an issue (unless it's some crazy martingale/no stoploss strategy)


Have you heard of a forex trader who compounded his trading account and became an multimillionaire in a few years? If you do, let me know


Well, first off, compounding is proven to be a very good decision for me so far. Since April 2010, I went from $1,000 to $2,750 using compounding, while without compounding, I would be at about $1700. That's $1750 profit with compounding against $700 profit without compounding (yes, live account).

I agree that due to liquidity, compounding cannot continue without end, so you cannot make billions of dollars like the backtests or demo accounts show (because they don't count on liquidity; sometimes they aren't shown to scam you, but just from pure ignorance of the marketers), but yeah, you can make a few millions before the compounding stops working due to liquidity (depending on the trading system, this can be 1 million or a few million - THEN you stop compounding and collect much larger profits than you would without it). Compounding is where the biggest potential of the Forex market is, actually.

Also, if you think about it, except liquidity, there's no reason why the compounding wouldn't work (provided you have a quality system and broker), so simply put, it will work until you start having problems with liquidity, but until then you can use it, there's no reason not to.

BTW, Warren Buffet is not a trader, he is an investor - his average 'trade' duration is several years ;-) But yes, there are forex millionaires and most of them wouldn't be where they are without compouding, because they started with a few thousands at most. I don't know any personally, but then again, I don't personally know ANY millionaire and yet, I believe it is possible to become one ;-)

I advise everyone who doesn't believe it is possible to make big profits from anything (not just the Forex market) to read some books by Donald Trump. Your thinking will probably change and your bank account will grow accordingly, whatever you're doing, whether it's Forex trading or anything else ;-)

In the end, one of my favorite mottos is 'If you think $1,000,000 is a lot of money, how the hell do you want to become a millionaire?' :-)

Elkart posted:
    I dunno Windsor,

That compounding is extremely critical in growth. I read an interview a year or two back with a trader who did make millions in a very short period of time. So much so he told all his clients to fob off.

I for one am a very, very firm believer in compounding. If I can add 1 cent to a trade I do. That's why O is such a good broker.

The compounding doesn't help if you have a bad strategy. But on a good strategy it makes the world of difference.

Agreed. I have to learn how to express myself in short like you can :-)