What is an EA?
A Forex Expert Advisor (EA) is a program capable of performing any action following the instructions of a programmer/trader, without direct intervention.
All tasks are performed automatically without the distraction of human emotion, which is why the advisors are called experts, or mechanical trading systems.
The EA is a highly specialist compound positioning, hedging and trading algorithm.
Its development to finished product took over 12 months of programming and over 14 months of testing in live market conditions. The programming was conducted using 99.98% accurate modelling data, eliminating the risk of manipulation.
The EA was tested over 19 years of modelling data to ensure that it could operate in all average market conditions and extremes. The EA is designed to be low risk, with minimal drawdown. It targets 15-20% monthly ROI, but it is capable of higher returns (as recorded in our live data feed).
The EA is highly optimised and has a full-time programmer ensuring that the data is operating as per its parameters. The Forex market is a very fluid and ever-changing environment. Our level of optimisation is essential for the EA to operate as it should, while maintaining consistent results.
How does it work?
The EA places trades on pre-defined currency pairs.
It has several parameters that are required to be met before it will place a trade.
Volume and Liquidity
Institutional support and resistance levels
The most advanced aspect of the EA is its ability to compound position and hedge a negative position to close out in profit. This ensures that drawdown is not recorded as a loss on the account, but only holding a negative position.
These positions will always close out in profit as the EA algorithm will calculate new positions at key levels, which have a higher leverage. This allows a profitable outcome when the market retraces.
If, for example, a ‘buy’ position has an extreme ‘selling’ market against it, the EA will calculate the existing hedge risk and open a new hedge in the opposite direction. This will ultimately close out in profit.
The EA has several risk parameters programmed within the algorithm to ensure that risk is managed. It does not over-trade, or expose the account to extreme risk.
Average daily drawdown is between 1-5%. A more extreme hedge could see drawdown rise to 10%, and in an extreme event could rise to 20-30%. A full hedge would occur at approximately 40% drawdown.
The main point to remember is that the system will manage drawdown and closes the positions out in profit, so the account will not suffer a loss.
The EA will actively secure profitable positions by moving a SL (stop loss) into a risk-free position once the trade is into profit. This ensures that profits is regularly taken and reduces the risk. In some cases it will be a smaller profit that is taken, however this maintains a consistent way of securing profit.
The EA is designed for long-term investment and therefore risk is low. It uses small lot sizes and protects the account at all times. The EA has programs to cover extreme event, which are rare, but if they were to occur the system has been programmed with the ability to cope.
Daily profits are generally between 0.5-2% to ensure that profits are taken quickly and effectively. If a hedge occurs, this will increase drawdown. However, risk is still low and even at 5-10% it is not dangerous to the recommended minimum account.