MT5 a step backwards?? - page 11
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WHAT I AM SAYING is that your EXAMPLE may be the same as HEDGING on some trades BUT NOT ALL trades.
For all hedged positions involving simultaneous orders in opposite directions, there is an equivalent sequence of non-hedged orders. This is harder to code, but it is not impossible to code. MT5 makes life more difficult (and much more difficult than it ought to), but you can achieve exactly the same results as in MT4. In MT5, an EA can continue to think to itself in whatever way it likes about the nature of its current position, but the way it talks to the market has to change.
Re-using your original example, at stage 2 the MT5 EA can still think to itself "I need to go 1 lot short". What changes is that the MT5 EA has to do that by closing its current buy order - leading to the same net position, drawdown, risk etc as in MT4 - but it then has to remember privately to itself that it is 1 lot long and 1 lot short, rather than the 0 lots which is reported by MT5/the market. What changes is the way in which MT5 EAs have to talk to the market, and the fact that they have to "remember" more things for themselves rather than relying on the overall net position reported by MT5/the market.
No... No... No....
The benefits of hedging are there: MINIMIZING DRAWDOWNS, PROFITING FROM RETRACEMENTS, AND PROFITING FROM ORIGINAL TRADE.
Nonhedging instead COMPOUNDS to the DRAWDOWN. Again, retracement can go deeper than predicted and you risk stopping out with nonhedging.
CLEARLY, there is no TRUE equivalence to hedging. ELSE, they would all be banned because hedging is quite profitable!!!
I have NO LOSING trades from all my planned hedge trades compared to my nonhedges: 100% profitable from my own experiences.
COMPOUNDING to your drawdowns from your nonhedging example CAN HAVE SEVERE CONSEQUENCES on
your emotional psychology. This means you are F*CKED.
Hence, you need to start kissing your money goodbye because you will eventually snap from emotional breakdown.
TRADING is supposed to be STRESSED-FREE. If YOU ARE STRESSED-OUT, you are missing out!
The benefits of hedging are there: MINIMIZING DRAWDOWNS, PROFITING FROM RETRACEMENTS, AND PROFITING FROM ORIGINAL TRADE.
Back again, briefly...
This statement of yours is completely wrong. I have repeatedly demonstrated how the non-hedged equivalent of your original hedging example involves exactly the same net position in the market, and therefore the same profit, the same drawdowns, the same risk etc. You are getting confused between the EA's internal position management versus the way this appears in terms of the orders making up the same net position in the market. Shouting things in CAPITAL LETTERS doesn't make you correct; it just makes you sound desperate.
Incidentally, I spent much of 2009 and 2010 running an EA which made extensive use of hedged orders. Re-writing this system to work with MT5 would be very annoying. But it wouldn't be impossible.
jjc and ckingher... Having spent a lot of time trying to clarify the hedge issue.... I've come to the realization that if you trade using hedging that you understand it and make good money in both directions all the time.... And that if you don't trade using hedge it is impossible for you to visualize exactly how it can make money, as you are blinded by the fact that the positions offset. It is really about the timing and I don't think non hedgers get that.
I do and have done both. Top marks for the efforts in conciliation and rationality but, as someone who does use and has used hedging, MT5 doesn't prevent hedging strategies. It prevents hedged orders. Not the same thing. You can implement the same strategy using non-hedged orders. I refer you back to the EA I wrote, more or less personally for you, on Feb 12th (page 6 of this thread)...
I know that you are either a "LIAR" or an "INEXPERIENCED" hedger. But heck, I don't get pay to train you. Therefore, keep on doing what you are doing. All I know is that, I will become really rich in the future. Heck, it is my success that is most important. I don't need students.
FOR THOSE WHO ARE NOT STUBBORN, here is something to think about.
If there are "EXACT" EQUIVALENCES to HEDGING, then the NFA must be really stupid.
Banning HEDGING is pointless and meaningless if there exist equivalances.
So come on, NFA ain't dumb.
I REPEAT, there ain't no equivalences. If there were equivalences, it would be pointless to have new NFA rulings!!!!!
HEDGING is like card counting. Why do you think CASINOES banned card counters and use more than one deck today?
This is harder to code, but it is not impossible to code. MT5 makes life more difficult
Not necessarily harder or more difficult, just a bit different.
In fact there are a few things that are even easier to do with MT5. Grid strategies for example could be programmed super-easy with Mt5 and pending orders (no TP or SL, only pending buy or sell orders), especially when superimposing multiple long and short grids on the same pair you don't accidentally open opposing trades (I regard this behavior in MT4 as a design flaw), instead they simply cancel out each other as it should be.
Some things are even nearly or completely impossible in MT4 but easily possible in MT5, for example biased grids where the long orders are of different size than the short orders or have a different grid spacing.
Also in NFA-crippled MT4 you can run into severe problems with the FIFO-conforming ordering of stoplosses or takeprofits: you have to rearrange them after every order fill which is only possible if they are all of the same size, otherwise it would be nearly impossible or incredibly complex and you cannot just use pending stop- or limit-orders instead because of the bug that it would open a hedge instead of closing.
MT5 makes all these problems go away.
MT4 is not FIFO crippled. It is the new NFA rules that tries to crippled MT4.
And heck, FIFO is not that difficult to implement in MT4 in the first place.
FIFO is simply the acronym for FIRST IN FIRST OUT.
This means, you need to sort your orders by their OPEN DATES, not lotsize and whatever.
Thus you just close out profitable trades in order of their open dates.
What is so hard about that???
I am MT4 die hard. And once MT4 becomes discontinued, I will just move on to a different platform
such as TradeStation.