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Will an automated trading Expert Advisor perform on a real account in a similar way as in the Strategy Tester?

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Roi.Scout
55
Roi.Scout  

Hi all,

I am a newcomer to Forex and Metatrader but I do know that past performance is not a guarantee of future performance. However, with a Demo EA there is not even past performance, only the results from a Strategy Tester.

I could word the subject title differently: Does the Strategy Tester results provides enough assurance as to spend your money on an automated trading expert expecting to obtain similar results?

Your inputs will be highly appreciated. Thanks.

Alain Verleyen
Moderator
33621
Alain Verleyen  
Roi.Scout:

Hi all,

I am a newcomer to Forex and Metatrader but I do know that past performance is not a guarantee of future performance. However, with a Demo EA there is not even past performance, only the results from a Strategy Tester.

I could word the subject title differently: Does the Strategy Tester results provides enough assurance as to spend your money on an automated trading expert expecting to obtain similar results?

Your inputs will be highly appreciated. Thanks.

Never.
Roi.Scout
55
Roi.Scout  
angevoyageur:
Never.

Well ... this is a clear and concise answer that leaves no room for misinterpretation.

If the Strategy tester results do not provide any assurance, I think MQ is not acting adequately with regard to potential buyers of EA because it is not giving all the necessary information so that they can form an opinion based on the real behaviour of the EA. Why?

In the case of signals, the accounts are monitored and detailed statistics and trading history are provided , while in the case of EA, none of this happens. Even when it comes to signals running on demo accounts, many people, including yourself, claim they never would subscribe to them. However, in the case of a trading EA, the buyer does not even have the possibility to analyze what happens in a demo account. The only option offered is to run the demo EA and watch some screenshots that do not represent the real behavior or the EA, but some results obtained by the developer with the Strategy Tester with the most favourable execution mode and within the time periods that provide awesome results.

In my humble opinion, MQ should set mandatory that anyone who wants to sell an EA should run it on a real account for a minimum period of three months and MQ should monitor the account and provide at least the same information (statistics, trading graphs, ...) that is provided with signals. That way the buyer would be able to take a decision based on REAL data.

This is further justified by comparing the costs of the signals and the costs of the trading EA. While a monthly subscription to a signal cost in most cases around $ 50 and also it is possible to unsubscribe after a month, on a trading EA you have to pay several hundred dollars or even a few thousand, and once that money has been paid, it is gone without any refund if things go wrong.

So, which is the buying market for these expensive trading EA? Unfortunately and with the permission of MQ, it seems that the unexperienced naive newbies. 

Regards 

Documentation on MQL5: Standard Constants, Enumerations and Structures / Environment State / Account Properties
Documentation on MQL5: Standard Constants, Enumerations and Structures / Environment State / Account Properties
  • www.mql5.com
Standard Constants, Enumerations and Structures / Environment State / Account Properties - Documentation on MQL5
Alain Verleyen
Moderator
33621
Alain Verleyen  
Roi.Scout:

Well ... this is a clear and concise answer that leaves no room for misinterpretation.

If the Strategy tester results do not provide any assurance, I think MQ is not acting adequately with regard to potential buyers of EA because it is not giving all the necessary information so that they can form an opinion based on the real behaviour of the EA. Why?

This is not specific to MT5 or Metaquotes. A Strategy Tester can never give the same results as a forward live test. Main reason is slippage/requote. The best that can be done is to simulate these characteristics more closely. I think MT5 is better than MT4 at doing this. The second reason is what you say yourself "past performance is not a guarantee of future performance", a fortiori for backtesting.

In the case of signals, the accounts are monitored and detailed statistics and trading history are provided , while in the case of EA, none of this happens. Even when it comes to signals running on demo accounts, many people, including yourself, claim they never would subscribe to them. However, in the case of a trading EA, the buyer does not even have the possibility to analyze what happens in a demo account. The only option offered is to run the demo EA and watch some screenshots that do not represent the real behavior or the EA, but some results obtained by the developer with the Strategy Tester with the most favourable execution mode and within the time periods that provide awesome results.

I agree with you, I always wonder how someone could buy an EA he can not even test, but yet EA are sold all around the world. Some EAs in the market here, provide demo version that you can run on a forward test, it's a step forward. There are users of this site who are asking a test period (forward test) for the market, maybe MQ could provide this feature in the future.

In my humble opinion, MQ should set mandatory that anyone who wants to sell an EA should run it on a real account for a minimum period of three months and MQ should monitor the account and provide at least the same information (statistics, trading graphs, ...) that is provided with signals. That way the buyer would be able to take a decision based on REAL data.

Agreed. That would be a great feature to provide such confidence to buyers, and in my opinion a commercial advantage for for Metaquotes (and sellers).

This is further justified by comparing the costs of the signals and the costs of the trading EA. While a monthly subscription to a signal cost in most cases around $ 50 and also it is possible to unsubscribe after a month, on a trading EA you have to pay several hundred dollars or even a few thousand, and once that money has been paid, it is gone without any refund if things go wrong.

So, which is the buying market for these expensive trading EA? Unfortunately and with the permission of MQ, it seems that the unexperienced naive newbies. 

Regards

You can try to make suggestions to Metaquotes, but good luck then.


P.S: All I write here is my personal opinion only, I don't work for Metaquotes.

Rogerio Figurelli
Moderator
44599
Rogerio Figurelli  
Roi.Scout:

Hi all,

I am a newcomer to Forex and Metatrader but I do know that past performance is not a guarantee of future performance. However, with a Demo EA there is not even past performance, only the results from a Strategy Tester.

I could word the subject title differently: Does the Strategy Tester results provides enough assurance as to spend your money on an automated trading expert expecting to obtain similar results?

Your inputs will be highly appreciated. Thanks.

Note that nothing provides enough assurance when you are talking about the future performance.

Backtesting is a way to test/face your EA to past conditions, and maybe a quantitative way to reduce uncertainty, but anything can happen, even the actual result be much higher than simulated!

Eduito
2079
Eduito  

I have recently asked a couple of times to the seller of one of those amazingly profitable Expert Advisors (according to the Strategy Tester) that are offered in Market, to let me have a look at his MT5 account with the Investor password. The answer I got was: SILENCE. Weird, isn't it?

Achmad Hidayat
15835
Achmad Hidayat  
Eduito:

I have recently asked a couple of times to the seller of one of those amazingly profitable Expert Advisors (according to the Strategy Tester) that are offered in Market, to let me have a look at his MT5 account with the Investor password. The answer I got was: SILENCE. Weird, isn't it?

You mean "SILENCE" is no answer? I do not think weird.

If you ask to me, my answer is I have no one.

I personally believe that both the back testing or forward testing (live results) can not guarantee will give the same results in the future, never ...

Eduito
2079
Eduito  
achidayat:

You mean "SILENCE" is no answer? I do not think weird.

If you ask to me, my answer is I have no one.

I personally believe that both the back testing or forward testing (live results) can not guarantee will give the same results in the future, never ...

SILENCE = NO ANSWER

Of course, nothing is guaranteed, but I do not expect that the performance of the EA on live to be completely different to what the backtests show and instead of sustained profits be faced with continuous losses.

If I had developed a very profitable EA that I am trying to sell for a large amount, I would be running it on a demo or in a real account, right?

Then if a possible buyer asks me to have a look at my account with the investor password (which I can change on the next day) to verify that what happens in the Strategy Tester is confirmed by the results on a real account, why would I refuse? Allowing this person to look at my account is a marketing tool and if the person is satisfied, he would probably purchase my product. Of course, provided that THE RESULTS ACHIEVED ON A REAL (or even on a demo) ACCOUNT DO NOT SHOW BIG DISCREPANCIES WITH WHAT THE STRATEGY TESTER IS SHOWING. Where is the problem if there is nothing to hide?

HOWEVER, if what I get on live are losses, I would NEVER show my account to anybody and to avoid saying No, I wouldn't answer.

Therefore, to me no answer is more than weird, is SUSPICIOUS and puts a big question mark on that EA.

Documentation on MQL5: Standard Constants, Enumerations and Structures / Environment State / Account Properties
Documentation on MQL5: Standard Constants, Enumerations and Structures / Environment State / Account Properties
  • www.mql5.com
Standard Constants, Enumerations and Structures / Environment State / Account Properties - Documentation on MQL5
Bharamappa Gojanur
351
Bharamappa Gojanur  

then how to purchase a good EA and how to identify or define a good EA :)

Simon Gniadkowski
Moderator
18042
Simon Gniadkowski  
drbmgojanur:

then how to purchase a good EA and how to identify or define a good EA :)

You want to know how to find a Needle in 10000 haystacks ?
Eduito
2079
Eduito  
RaptorUK:
You want to know how to find a Needle in 10000 haystacks ?
That sounds extremely skeptical, but you're probably right :-(
12
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