An essential part of evaluating any trading system, whether you developed it yourself or bought it over the internet, is to discover how robust your chosen system is to changes in the system input parameters. Unfortunately the developers of Forex MegaDroid don't give their users the ability to alter the parameters that control their robot's "artificial intelligence". We assume there must be a few hidden somewhere inside the Droid's electronic brain, but there is no way for us to twiddle them with our virtual screwdriver. We assume that Albert and John spent many months tuning their creation to perfection. They have, however, made it very difficult for us to try and work out if they have over-optimised their robot's mega-mind. Maybe it will suffer a virtual epileptic fit one day soon? We have no way of knowing.
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After a lot of experimentation we finally managed to work out how duplicate the first trade in 2009 shown on the Forex MegaDroid website. Not only that, but using a demo account from FXDD that supplies historical data with only 4 decimal places, and working out exactly the right values for the Risk Level and GMT Offset input settings allowed us to duplicate the first 75 trades, up to and including the loss of $4672.00 on March 18th. After that though, the differences between our backtest results and those shown by the Forex MegaDroid team become more and more obvious.
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It's now three month's since "Forex MegaDroid landed on the Forex industry like a BOMB". The time has come to try and tie together all the backtesting, forward testing and live testing, and to decide whether to keep the Droid running on our virtual private server for a while longer. Unfortunately this is not an easy task!
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An email from the Forex MegaDroid team was waiting for me in my inbox this morning. It seems they will be releasing a new version of their robot before the end of the month, which is when the first-in first-out provisions of NFA compliance rule 2-43(b) finally come into force.
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Here are our first set of Forex MegaDroid live test results, which cover the month of June 2009. Here at the Trading Gurus we recommend forward testing any new forex trading system on a demo account for at least three months before even thinking of trying it using real money on a live account. However our loyal readers have been asking to see some live results. After 2 months testing on a demo account with no major disasters for the MegaDroid we decided to start live testing using a modest initial deposit of $500. On an account that supports micro-lots this is sufficiently large to allow the Droid's money management system to start trading with more than the bare minimum position size. It is also a reasonable sum of money for someone new to forex trading to be prepared to lose. As you have hopefully realised by now, newcomers to forex trading do have an unfortunate tendency to lose money.
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I logged into our virtual private server this morning, excited at the prospect of writing about our first month's live Forex MegaDroid testing using real money. That will now have to wait for a while, because I discovered something even more interesting. The Forex MegaDroid robot had completely stopped working, and not for the first time!
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Here are our Forex MegaDroid backtest results for May. The distinction may not be obvious, and may even seem irrelevant, but nonetheless although these are backtest results, the data used for the backtest was acquired on a demo account moving forward in time and not from a downloaded MetaTrader history. This test was performed using exactly the same input settings as in our MegaDroid Backtest Results for April.
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The FXCM Limited MetaTrader banner promises:
No Dealing Desk Execution
Hedging Capabilities through FSA Regulated Entity
Spreads as Low as 1 Pip EUR/USD
Accept ALL MT4 Expert Advisors
The Trading Gurus are based in South West England, so we're not too unhappy about the idea of opening a live account with an FSA regulated forex broker based in the UK. Those bullet points sound exactly like the sort of brokerage account we've been waiting for, so I opened a demo account with FXCM UK, and fired up one of our Expert Advisors.
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Somewhat later than anticipated after my recent trials and tribulations, here are our Forex MegaDroid backtest results for April. This test was performed using version 1.11 of the robot, since the original version now refuses to run backtests. This test used the default input settings, with the following exceptions, mainly required because the test used Alpari UK as the MetaTrader broker, and they support micro-lots and 5 decimal places.
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I don't know about you, but when I use a forex trading robot I expect to be able to upload it to my server, set it running, then wait for it to start trading. Beyond that, I expect it to keep on trading whatever accidents might befall it, including recovering gracefully after losing its connection to the internet for a while, or restarting after an unanticipated server reboot. It seems that in the case of Forex MegaDroid this was far too much to expect.
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