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What makes signals good or bad?

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Thomas Kjelvik
1507
Thomas Kjelvik  

What makes a good signal and signalprovider? Many signalproviders overinflates their Return by starting With small deposits and so on.

What do you think?

Mohammed Mounir
996
Mohammed Mounir  

In my opinion there are some factors to check the signal provider

- Profits

- Risk

- Drawdown

- Balance

- Trading strategy (Ask him how his trading style or strategy works)

- Track his signal for a while without subscription 

Sergey Golubev
Moderator
100323
Sergey Golubev  

Forum on trading, automated trading systems and testing trading strategies

How to Start with Metatrader 5

Sergey Golubev, 2017.03.17 12:54

The Easy Way to Evaluate a Signal: Trading Activity, Drawdown/Load and MFE/MAE Distribution Charts 


Subscribers often search for an appropriate signal by analyzing the total growth on the signal provider's account, which is not a bad idea. However, it is also important to analyze potential risks of a particular trading strategy. In this article we will show a simple and efficient way to evaluate a Trading Signal based on its performance values:


Marco vd Heijden
Moderator
5929
Marco vd Heijden  
Thomas Kjelvik:

What makes a good signal and signalprovider? Many signalproviders overinflates their Return by starting With small deposits and so on.

What do you think?

I think if it's a winning signal, it's good...But if it's a losing signal, it's bad...

Would you think otherwise ?

Yerlan Imangeldinov
885
Yerlan Imangeldinov  
Need good trader, not signal stats, market very hard place and professionals not use a simple move. Nobody can predict next move genius trader, you can't put trader to some box.  Signals provider need find liquidity. Trade with 1000$ not same as trade one million dollars.
Angelito Cartagena
403
Angelito Cartagena  

As a matter of opinion based on my experience and knowledge, if you want a lifelong signal to follow, find a signal provider that implement good RR(at least 1:1),dont use martingale,hedging approach,no loss strategy. And do not follow high winning rate(85% or above) signals because its probably using high risk approach, realistic/sustainable strategies has winning rate 70% and below. Another thing is do not follow a signal provider that has monthly gains of above 30% or higher? why because their is a strong possibility also that in the future this particular signal will acquire a loss of this magnitude.We are talking about drawdown here, low drawdown that uses approach as mentioned above is still susceptible to big time loss that can easily wiped out your account.

Victor Ziborov
2299
Victor Ziborov  
Mohammed Mounir:

In my opinion there are some factors to check the signal provider

- Profits

- Risk

- Drawdown

- Balance

- Trading strategy (Ask him how his trading style or strategy works)

- Track his signal for a while without subscription 

Mohammed, I agree with the factors you quoted: Profit, Risk, Drawdown. However, I think that the author of the signal will not tell us his Trading strategy. Trading strategy is his know how, his trade secret. If you know its Trading strategy, then you will not need its signals. It is obvious.

Victor Ziborov
2299
Victor Ziborov  

In my opinion, first of all you need to look at how many months there is an account. The life of the account should be more than three years. Drawdown should be less than one third of the depot, that is, less than 33%. The profit of each month should be about 7-10%.

Victor Ziborov
2299
Victor Ziborov  
Victor Ziborov:

In my opinion, first of all you need to look at how many months there is an account. The life of the account should be more than three years. Drawdown should be less than one third of the depot, that is, less than 33%. The profit of each month should be about 7-10%.

It is necessary to look at the history of transactions: does the trader put a stop-loss? SL should be. Sharpe Ratio is supposed to be at least 0.1. Sharpe Ratio shows that in order to earn $1 a trader had a drawdown by equity of an average of $10. It is not necessary to see the availability of subscribers. The crowd is not always right.

Victor Ziborov
2299
Victor Ziborov  

Mql5.com has several articles on how to evaluate, and how to choose a trading signal:

https://www.mql5.com/en/articles/2704

https://www.mql5.com/en/articles/1838


The Easy Way to Evaluate a Signal: Trading Activity, Drawdown/Load and MFE/MAE Distribution Charts
The Easy Way to Evaluate a Signal: Trading Activity, Drawdown/Load and MFE/MAE Distribution Charts
  • 2016.09.28
  • MetaQuotes Software Corp.
  • www.mql5.com
Subscribers often search for an appropriate signal by analyzing the total growth on the signal provider's account, which is not a bad idea. However, it is also important to analyze potential risks of a particular trading strategy. In this article we will show a simple and efficient way to evaluate a Trading Signal based on its performance values.
Dua Yong Rew
5536
Dua Yong Rew  

How does metaquotes rank signal? What factor did they use?

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