Million Dollar Pips Discussion

You would be surprised to know that many hedge funds use similar mean-reverting techniquest, the most prominent is Medallion fund from Renaissance Technologies, one of the biggest and wealthiest funds of the planet. So MDP is not anything new or unique, William and Co just captured the right moment where retail FX industry evolved to the point where low spreads and fast enough execution allowed to do something similar. Mr. Simons and his space engineers from Renaissance did this in 1988 onwards. The problem for most people out here with MDP is that they overleverage disastrously and use overcrouded brokers who can't cope with the load that hits their servers when MDP starts to trade..

   ForexMentor posted:
   Seriously the comments on here are comical.... what you think you can spend less than the cost of a few trips to McDonalds on buying a robot and it will answer all of your financial problems or dreams of wealth !! When you trade you are up against big organisations that want to maximise profits, as you do, the big difference is they can move the price action and you can not. They know you, they know your leverage, your greed, your fears, your stops, your take profits, basically your a sitting duck !!

Ok lets put things in perspective...... what you seek does not exist for the moey you wish to pay......

Stop wasting your time dreaming that a robot is somehow going to solve all this, I seriously think that all the major banks would be purchasing the rights to such an awesome product if it exisited and lived upto expectations. But guess what ! It dosent !!!

Trading is a brutal business and those who know how to trade make from those that dont, thats reality, harsh though it may seem.....

I have never seen or been shown a robot that can produce profits, well unless you happen to be selling it, rather than using it !!

Keep chasing the dream, but learn how to trade, not buy robots!

It was a matter of time when MDP will blow Your accounts and everyone agreed to the rules of this game :)

Just to chip in: 1st broker today: +0.3 % (0.7 % for the month), 2nd broker +4,4% (+10% for the month), same settings.

So MDP still works, but it will not work forever with the same (internal) settings. For how much longer is the question and will William still provide updates as he now promotes his new EA? - I had a phone call with my 2nd broker's representative yesterday and he meant the S/L of MDP is too tight. I don't totally agree as the tight S/L also keeps the losses small. With a higher S/L the whole profitability of the system could be gone.
Happy trading!

Fred_forex: what settings do You use ? I had loses on all accounts.

Some good responses and comments to my post, the hedge fund and use of robots especailly.

Anyone is entitled to design and sell a robot and make money, I guess for some doing that is a lot easier than tradng, which is hard and requires learning, disipline and dedication.

Im not here to try and prove anythng, sell anything or share my results of my professional trading account with anyone, why would anyone want to do that? unless they had a commercial reason to prove something ?

I just wanted to make the point that Ive never seen a robot do well over time, mainly due to the fact that these type of extreme scalping robots require super low spreads and very fast execution times.

Fap Turbo was a prime example of needing low spreads also, but by the fact it only really traded its scalping strategy during the Asian market, when most brokers spread increases due to lower voilitiy meant that it was hard to make that work unless you enjoyed those low spreads during these times.

Set up a demo account on most brokers and it works becuase the spreads are not realistic and dont reflect in reality what you will get when in live market conditions, like at Alapri (UK) the demo account uses the same feed as the Pro account, the pro account has low spreads, which many are not going to be opening due to the desposit required and lot sizes needed to trade. So your robot works, now put it on a regular account and it cant even open a trade half the time due to the spreads and requotes.

Anyway interesting topic.......

ForexMentor, you are right and wrong, right about brokers and spreads, but wrong about strategy longevity, it is just opposite - scalpers tend to do well much longer that any longer-terms strategy as market micro-structure does not change, as well as market making techniques that give scalpers opportunities, however trending regimes change a lot, making any longer-term robot not to do well, since market exposure is high and many event occurs while in a trade. Longer term trading much better done by old-fashioned hand, robot may just give few potential signals but not to make a decision.

Actually he is not right about brokers either. The industry is evolving very fast and today there is bunch of forex brokers who gives You very low spread and they do not require huge deposits as AlpariUk.
About the longterm, also wrong, why do ppl write such nonsens? I know at least couple strategies working for at least 3/4 years.

So I've seen a EA doing well over time.
I see brokers with low spreads and acceptable minimum deposits - a lot of them. (Just to make clear, low spread = avg. spread at 0,6 starting from 0 - and starting from zero means that I can see 0 spread a lot of times during the day).

I agree...... but I only know of one broker currently that supports MT4, is ECN and offers super low spreads, typically during the day for GBPUSD 0.60, EURUSD 0.30 and GBPJPY 1, during the Asian they naturally go up slightly but still remain very low and more importantly are becoming usable for robots that require low spreads to work.....like FapTurbo.

MDP obviously benefits from this also but has the added hindrence of requiring lighting fast execution to be successful. I Know some VPS services offer a realistic maintainable 10ms execution, at a cost, which to make MDP work to its maximum potential is esstential. Personally I prefer to control everything from my own PC, where I can only manage about 41ms latency

One other point ..........on here most people seem concerned about whos right and whos wrong and are constantly running down other comments and proffessing to be the font of all knowledge. Probably frustrarted traders letting off steam, as with many other forums.

As a suggestion why dosent everyone stop this and try and offer some usable wisdom, or whats the point......imo

Well, it's not so much of a problem if you look more carefully. There are fast brokers out there, not overcrowded. I never used FAP, so cant comment, but I used MegaDroid and abandoned it after a while, like you said overnight spreads are high, but also the market regime has changed in 2009-2010 when very calm Asian sessions started to be turmoiled sometimes registering bigger moves than during European and American. Most importantly the idea of trading with 100 pips stop loss only to capture 10 is not sustainable by any means and in a long run this will blow your account on a chain of sigma-events. I like mean-reverting strategies like MDP because risk-reward is generally good. The problem most people have with MDP is overleveraging looking to turn their peanut accounts into six digits in no time, using overcrowded brokers, pushing the strings on execution performance too far with their 8-orders configuration promoted by Morrison as 'default', and not understanding market mechanics. These people will lose their shirts sooner than later or will abandon in frustration looking for a next holy grail.

   ForexMentor posted:
   I agree...... but I only know of one broker currently that supports MT4, is ECN and offers super low spreads, typically during the day for GBPUSD 0.60, EURUSD 0.30 and GBPJPY 1, during the Asian they naturally go up slightly but still remain very low and more importantly are becoming usable for robots that require low spreads to work.....like FapTurbo.

MDP obviously benefits from this also but has the added hindrence of requiring lighting fast execution to be successful. I Know some VPS services offer a realistic maintainable 10ms execution, at a cost, which to make MDP work to its maximum potential is esstential. Personally I prefer to control everything from my own PC, where I can only manage about 41ms latency

Misty

Yes I agree everyone wants to be minted by next week, after shellling out only $99 for a robot...lol !!

So are you saying then that with conservative Money management using MDP it works? do you run it live yourself?

I have made my own robots and during the right conditions set up agreesively can double a live account in a week, but then on other occasions blow your account. But we are in a risk business and sometimes you have to take risks, but managed properly its possible to run accounts, withdraw profits and accept the odd melt down and still remain profitable.

I found the alternative is that you have to have a tidy account balance, trade with small positions and accept huge drawdowns.

I trade MDP and some of my own strategies, but later are still in development/live testing mode. I plan to move out of MT4 platform with my own stuff, though. I trade MDP with an account well into 5 digits and had excellent results, but again I am more on a conservative size, I don't run too much orders, I use the least risky filters and I have backtested 2 years worth of Dukascopy tick data for hundreds hours to find a configuration that would not send me down more than 12% at any time, while still be highly profitable. Sure, past is not an indication of the future, but 2 years of tick data with 99% quality does say a lot for a scalper. I started by running high-risk configuration Morrison preaches as default, got in a nice run-up, but lost most of it at the end of October due to very bad spike on EFSF 1Trl rumour that was much baddened by disastrous broker's behaviour forbidding any modifications to cap the risk. That day I lost several thousands. Recovered at a slower pace since then, much lesser risk, lots of back tests, and changed broker eventually.

Good to hear a positive story about robot trading, do you use any other commercial robots apart from MDP ?

Sounds like you have MDP sorted, I might invest myself now I hear it can be made to work.

I guess they have a ton of upsells? what version are you using if you dont mind me asking.

oh one other thing, those back tests, did you do those on here ? I assume you did, but cant seem to find where the strategy tester is .....

   ForexMentor posted:
   Good to hear a positive story about robot trading, do you use any other commercial robots apart from MDP ?

Sounds like you have MDP sorted, I might invest myself now I hear it can be made to work.

I guess they have a ton of upsells? what version are you using if you dont mind me asking.

There are no upsells. I used also ForexGrowthBot, and it is quite profitable but has drawdowns to 30% which is unacceptable in my book. I bought an upsell Power Edition, it allows you to fully customized it and provides with an EA source code (besides the actual strategy which is hidden in DLL), so I modified it enhancing it's risk controls. Countless hours of testing and I got a configuration which produced same 200% profit for 2011 but with only 10% drawdown as opposed to 30+ of the standard bot. And it even works no on M15 charts that standard FGB uses. It's in forward testing though, I intend to run in on demo for a couple of months before moving forward to a live test.

Tests are private. I plan to launch an website giving people the right configurations and tons of information of quality back tests and different setups for any kind of risk appetite in a return to a purchase via refferal link or setting up with a broker via my introducing broker link. Or for a small outright fee for a membership in the club. It is a lot of work, after all. Almost never ending as robots require constant updating.

ForexMentor, you're talking about 0.6 for GBPUSD, 0.30 for EURUSD, but you should also state clearly that these spreads are obtained with commissions (about 3.5$ per lot). If you addition commissions with initial spreads you are far from having really these ones.

I would say commissions are usually around 25-35 usd per million for retail accounts, i.e. 0.6-0.8 pips to add. I have around 1.3-1.4 spread on eurousd most of the time including commissions, and I consider it a very good deal.

Am yet to finish programming my own robots, hope it works well, am testing it at the moment on a live account

   silver06 posted:
   ForexMentor, you're talking about 0.6 for GBPUSD, 0.30 for EURUSD, but you should also state clearly that these spreads are obtained with commissions (about 3.5$ per lot). If you addition commissions with initial spreads you are far from having really these ones.

Yes your correct there are comsissions to pay, its on a sliding scale depending on account size and starts at $2.95 per lot, but for example EURUSD is often at 0.30 spread ot lower, currently live its running at about 0.50.

But I guess the point when trading a robot is this, you want a low spreads so it can open orders