sstrategy tester vs. live trading

[fxkeysharp]

I have a live account since Jan 4 and am using a tweaked ea from the mt5 platform.  the strategy tester for the time period shows that I should have a profit of1.20 % at this point but my actual trading shows a . 34% profit.  when I look at the trades on the tester chart and look at the printout in the journal, I find that the first trade is the same as my history shows for my real trades, and from there on nothing is  the same.  To me if the tester is not reporting at least some similar trades then it is not right.   Where am I wrong?

[Pawel Wojnarowski]

fxkeysharp:
I have a live account since Jan 4 and am using a tweaked ea from the mt5 platform.  the strategy tester for the time period shows that I should have a profit of1.20 % at this point but my actual trading shows a . 34% profit.  when I look at the trades on the tester chart and look at the printout in the journal, I find that the first trade is the same as my history shows for my real trades, and from there on nothing is  the same.  To me if the tester is not reporting at least some similar trades then it is not right.   Where am I wrong?

There is plenty of possible reasons, some of them including:

 - different quote feeds for strategy tester and live account (= different trading signals, different order & deal prices etc.)

- requotes on live account

- slippage on live account 

etc. 

[fxkeysharp]

Enigma71fx:

There is plenty of possible reasons, some of them including:

 - different quote feeds for strategy tester and live account (= different trading signals, different order & deal prices etc.)

- requotes on live account

- slippage on live account 

etc. 

If that is so then what good is the strategy tester?

[fxkeysharp]

I guess what I am trying to say in this post is,  why strategy test and come up with the perfect ea if when you start using it the system does not work as you saw on the test.

For the past two weeks  or since the 4th until now the strategy tester shows a profit of $4,320 and currently I am drawn down $388 from my starting equity.  Just doesn't make sence to use a strategy tester if your live results aren't close to the test.  Might as well not use it.

[Andriy Moraru]

Strategy tester is good to be used this way: if EA fails in is ST it probably will fail in live account. It's also good to test the potential profit of strategies that don't involve SL, TP or scalping.

[fxkeysharp]

Thank you Enivid, but the strategy tester told me it did not fail and from 1-4 to 1-20 says my profit on the demo should be $14,000, I see that my profit is $700 and I realize that the strategy tester is ineffective. if other factors that it can not take into consideration affect the outcome of my account then what good is it.  the strategy tester shows that the ea is profitable and my real account and the demo show that it is not.  So, what good is it and why use it.  I relied on it and am loosing.  I am using the 3emarisklimit ea and it works well in trends but in ranges it is awful.  But in doing a strategy test over the period of when I opened the account and to day, which is about two weeks  the strategy tester shows my profit should be about $4,000 on my live account and $14,000 on my demo account.  But it is not.  If it was a small sum diff then it would be ok but it is not.

regards

[Andriy Moraru]

fxkeysharp:

Thank you Enivid, but the strategy tester told me it did not fail and from 1-4 to 1-20 says my profit on the demo should be $14,000, I see that my profit is $700 and I realize that the strategy tester is ineffective. if other factors that it can not take into consideration affect the outcome of my account then what good is it.  the strategy tester shows that the ea is profitable and my real account and the demo show that it is not.  So, what good is it and why use it.  I relied on it and am loosing.  I am using the 3emarisklimit ea and it works well in trends but in ranges it is awful.  But in doing a strategy test over the period of when I opened the account and to day, which is about two weeks  the strategy tester shows my profit should be about $4,000 on my live account and $14,000 on my demo account.  But it is not.  If it was a small sum diff then it would be ok but it is not.

regards

You didn't read carefully what I've said. If EA is profitable in the tester it has a potential to be profitable in live account, but necessarily so. On the other hand, if the strategy fails in tester it will almost certainly fail in live account. I'm quite sure that the EA you are using is either scalping or relies heavily in SL and TP orders.

[fxkeysharp]

enivid:
You didn't read carefully what I've said. If EA is profitable in the tester it has a potential to be profitable in live account, but necessarily so. On the other hand, if the strategy fails in tester it will almost certainly fail in live account. I'm quite sure that the EA you are using is either scalping or relies heavily in SL and TP orders.

I guess I have made up my mind to look for a particular answer, sorry.  I suppose the fact that the tester shows a profit I should expect the real one to show a profit also but not in the same size.  I suppose I am expecting the tester to mirror the live account trade for trade which it won't do.  Ok, I can buy that. I am using the 3emafixedrisk ea, which seems to work well in trends.

[Wackena]

fxkeysharp:
I guess I have made up my mind to look for a particular answer, sorry.  I suppose the fact that the tester shows a profit I should expect the real one to show a profit also but not in the same size.  I suppose I am expecting the tester to mirror the live account trade for trade which it won't do.  Ok, I can buy that. I am using the 3emafixedrisk ea, which seems to work well in trends.

The strategy tester, at best, can only provide a basic reaction to the historic price data. In most cases, EA preforms worse in demo or live trading. In the past, I have seen big differences between the strategy tester, demo accounts and live to demo accounts on same broker. The main reason for tester results different from demo and live is the tester has fixed spread, fixed StopLevels and  price is from M1 bars (no interpolation below M1), no latency issues. The EA can run the same code on different brokers and I have found different results are from connectivity to server (Latency Times) issues and/or Spread and Stop Level settings by broker. It only takes 1 pip to make or miss a trade signal.

Demo and Live accounts by their nature will never have identical results. Demo has more static spreads and Stop Level, while with Live account these are always changing. Also, Demo accounts are direct market feeds, while Live accounts are through Broker's Bank to Market. This effects latency times and Broker's live account server can refuse order calls during high volume periods. This is the nature of Live account trading.

I have run 2 Live accounts on separate PCs, on same broker, same EA, same settings and had significant different results.