Challenger MT5

The only Expert Advisor you may need

Developed for passing trading challenges, including FTMO and prop firm evaluations.We have gone through a long and difficult path: from the earliest roots of interest in trading, to the idea of this Expert Advisor — or, more precisely, to the idea of the method that made it possible to bring this Expert Advisor into reality.

A classical approach — seldom used, employed by Challenger

1. Each trade is protected by a stop loss placed close to the market.
2. RR 1:1.2–2 (Take Profit is always greater than Stop Loss).
3. Take Profit and Stop Loss remain fixed after the initial placement.
4. Each trade is closed either by Take Profit or by Stop Loss.
5. No hidden mechanisms of premature position closure are used.
6. Martingale, grid, accumulation, or any other high-risk money management behavior is not used.

Statistical foundation

We consider trading as a sequence of events involving buy and sell executions. The most effective period for developing a trading system for XAUUSD — gold, the principal trading instrument of the Expert Advisor — under the current market conditions is six years. Historical data prior to 2020 differs too substantially from current market conditions, including in terms of volatility.

At the same time, the 2020–2024 period is also an excellent and necessary basis for strategy testing, since during this interval gold did not show strong growth, while the market had a shifted trading regime, without a predominance of either bulls or bears, which also made it possible to search for stability in a non-trending market.

We introduced simplifications into each separate part of the process in order to accelerate the standard strategy tester. We achieved a testing speed more than 100–1000 times greater than the testing speed available to ordinary traders.

More than 10 million combinations

We developed a custom tester capable of testing millions of strategy combinations and identifying the best among them — those that provide a statistical edge over a historical interval. We divide the market into two components: a predictive event and conditions.

A predictive event is a trading situation that is potentially advantageous on the target instrument, such as trend-following or the use of well-known regularities.

Conditions are the market states under which the market is able to make a particular move when the event occurs.

Given millions of combinations and an efficient tool for data analysis, all that remains is to identify the combinations that provide a mathematical edge.

Protection against overfitting, exclusion of AI, and testing

Our approach does not involve any use of artificial intelligence (AI) or machine learning. Such methods have a high tendency toward overfitting and toward excessive trust in the data, which means the results obtained are unreliable because of an improper relationship between the required sample size and the analytical tools used.

We used the following mandatory measures against overfitting:

• the full period is divided into subperiods (hereinafter referred to as local periods), one subperiod being equal to one year;
• for a strategy to be admitted to live trading, it must have:

1. at least 50 entries in each local period.
2. at least 500 entries over the full period.
3. the win rate in each local period must provide the specified edge.
4. the win rate over the full period must provide an increased edge.
5. strictly one predictive event and no more than 3 market-state conditions.
   

The last point is precisely the secret of the natural forward-testing results, since they deviate only minimally from previous trading. This effect was assumed by us from the very beginning, and this observation confirms it: a minimal set of analysed data reduces sensitivity to the data and preserves variability in the data on which a similar result is achieved. This also means that adding new data to the sample will have only a slight influence on the statistical performance indicators of each strategy.

As the custom tester was developed and trading systems were searched for, each strategy was subjected to forward testing on different intervals, and the testing passed through several stages in order to control the predictability of performance and the stability of the conclusions obtained.

Requirements for broker and account

• Broker: any
• Leverage: any
• Account type: any
• Trading pair: XAUUSD (Gold)
• Timeframe: any (please make sure that data for all timeframes is available)
• VPS: recommended

Description of input parameters

• Money management — select the money management type.
• Volume — specify the lot size or the risk per position as a percentage of equity.

• Trading mode — allow trading directions.
• Hedging mode — allow position hedging (automatically disabled on netting accounts).
• Delay — trading delay between positions within one strategy.
• Initial magic number — select the starting magic number; beginning from it, the 14 strategies will use unique magic numbers in ascending order.
• Comment tag — a text label for the Expert Advisor’s trades; it is not an identifier.

• Strategy N — enable or disable the trading strategy.

• Trade on day of week — configure trading permissions by days of the week.
• Trade time — configure the time during which trading is allowed for the Expert Advisor.