This series of blog posts is tracking my results actually using the winner of the Forex Robot World Cup competition.
Day 3 was slightly better - and somewhat worse. There were several winning trades - 11 in all - and 2 losing trades. But the winners were small winners, and the losers were fairly substantial. The overall result was a 0.05% gain for the day, and down 0.11% so far, considering only closed out trades.
But there were 2 disturbing aspects as well. One was that the robot has opened a number of trades which, if closed right now, would be substantial losers. If all the trades were closed out at the end of the day yesterday, the account would be down about 3%. Of course, part of a trading strategy is the exit strategy, so we'll leave it to see how the trades close out. One review of these robots warned that you do have to be patient.
The other aspect was that one of the trading strategies seems to open several trades that are virtual duplicates of each other. Yesterday, it made 10 trades (which is the configured maximum number of open trades at a time) all within a minute of each other, all for the same currency pair, and at virtually the same price. One of the key aspects of currency trading is that you limit your risk, so if any one trade goes bad, it's not going to totally obliterate your account. When you open multiple trades under the same condition, that's essentially the same as opening one trade with a much larger risk, because if one of those trades goes bad, they all will.
I'm still waiting to answer the question that I started with - Is it a scam, or is it real? I mean, as discussed in the opening post in this series, the numbers cannot possibly be anywhere close to real. And yet, if it's a scam, there's two more questions: How, and why?
Why? What would the promoters have to gain? The offer comes with a 60 day money back guarantee. If the robots are worthless, everybody's going to ask for their money back, and then what have the promoters gained? And they appear to have put a significant chunk of money into the promotion. Unless it was phony, the prize money for the competition was $150,000. Plus the expenses of setting up and running the web site, and creating the product.
And How? The results they claimed from the competition are real and verifiable. While some have pointed out that 2 months trading is not long enough to really validate a robot, still, if it really obtained those results, you would expect it to continue to produce some significant positive results for quite some time. It seems difficult to imagine how they could have produced fraudulent results.
One explanation of why is that they undoubtedly have a "referring broker" relationship with the broker that co-sponsored the competition. Brokers make their money of the spread, and make money each time you trade. It doesn't matter if the trade wins or loses - they still make their money. If the robots ares sold and used widely, the brokers are going to make some significant additional money, and the referring broker gets a commission on that. So even if all the robots are returned and they honor the money back guarantee, they would still make some money from their relationship with FXCM, the sponsor. Whether it would be enough to justify the effort is a big question.
It does appear that I have solved my anti-virus problems. I re-installed an updated version of the free anti-virus software I use, Avast, and then re-ran the installation of several of the packages. It no longer complained about most of them. One it did complain about, and blocked, but I was able to turn the AV software off temporarily while I installed it, and then turn it back on, and the robots ran normally, while I continue to have AV protection, so I'm satisfied. And their support desk did finally end up being helpful, though they were a little slow getting started. They gave me a link to the site http://forexspy.net/ , which has step by step videos of how to exclude the problem programs from the AV scans in several popular AV programs.
Time will tell. I keep hearing the little voice inside: "Patience, my friend, patience."
Day 3 was slightly better - and somewhat worse. There were several winning trades - 11 in all - and 2 losing trades. But the winners were small winners, and the losers were fairly substantial. The overall result was a 0.05% gain for the day, and down 0.11% so far, considering only closed out trades.
But there were 2 disturbing aspects as well. One was that the robot has opened a number of trades which, if closed right now, would be substantial losers. If all the trades were closed out at the end of the day yesterday, the account would be down about 3%. Of course, part of a trading strategy is the exit strategy, so we'll leave it to see how the trades close out. One review of these robots warned that you do have to be patient.
The other aspect was that one of the trading strategies seems to open several trades that are virtual duplicates of each other. Yesterday, it made 10 trades (which is the configured maximum number of open trades at a time) all within a minute of each other, all for the same currency pair, and at virtually the same price. One of the key aspects of currency trading is that you limit your risk, so if any one trade goes bad, it's not going to totally obliterate your account. When you open multiple trades under the same condition, that's essentially the same as opening one trade with a much larger risk, because if one of those trades goes bad, they all will.
I'm still waiting to answer the question that I started with - Is it a scam, or is it real? I mean, as discussed in the opening post in this series, the numbers cannot possibly be anywhere close to real. And yet, if it's a scam, there's two more questions: How, and why?
Why? What would the promoters have to gain? The offer comes with a 60 day money back guarantee. If the robots are worthless, everybody's going to ask for their money back, and then what have the promoters gained? And they appear to have put a significant chunk of money into the promotion. Unless it was phony, the prize money for the competition was $150,000. Plus the expenses of setting up and running the web site, and creating the product.
And How? The results they claimed from the competition are real and verifiable. While some have pointed out that 2 months trading is not long enough to really validate a robot, still, if it really obtained those results, you would expect it to continue to produce some significant positive results for quite some time. It seems difficult to imagine how they could have produced fraudulent results.
One explanation of why is that they undoubtedly have a "referring broker" relationship with the broker that co-sponsored the competition. Brokers make their money of the spread, and make money each time you trade. It doesn't matter if the trade wins or loses - they still make their money. If the robots ares sold and used widely, the brokers are going to make some significant additional money, and the referring broker gets a commission on that. So even if all the robots are returned and they honor the money back guarantee, they would still make some money from their relationship with FXCM, the sponsor. Whether it would be enough to justify the effort is a big question.
It does appear that I have solved my anti-virus problems. I re-installed an updated version of the free anti-virus software I use, Avast, and then re-ran the installation of several of the packages. It no longer complained about most of them. One it did complain about, and blocked, but I was able to turn the AV software off temporarily while I installed it, and then turn it back on, and the robots ran normally, while I continue to have AV protection, so I'm satisfied. And their support desk did finally end up being helpful, though they were a little slow getting started. They gave me a link to the site http://forexspy.net/ , which has step by step videos of how to exclude the problem programs from the AV scans in several popular AV programs.
Time will tell. I keep hearing the little voice inside: "Patience, my friend, patience."
Walking with God: Talk to Him. Hear from Him. Really., by John Eldredge
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