Criteria for removing an EA from live account?

[SteveM2030]

Hi Petko

I have followed your videos and am now testing over 500 EAs running over 6 demo accounts. I am monitoring all results on FX Blue. Recently some of the EAs have reached my criteria to be added to my live account. This criteria does vary slightly depending on how I generated the EA in the first place, but I only a consider an EA for entry into my live account if it has achieved a profit factor of 1.3 or more over 100 trades. I also want to see consistency – so it must stay profitable every 20 trades, or it can never have more than X negative profit days in a row. (Please note I am only testing 1M and 5M timeframes).

My question here is: what specific criteria do you have for <span style=”text-decoration: underline;”>dropping</span> an EA from your live account? I know one of your videos covers this (no 11 I think?) but it does not give specifics. My paranoia is that I promote an EA to my live account, and its initial performance is not as good as it was in the demo account. How long do you leave it? No one wants to make the mistake of abandoning an EA which is just going through a bad spell, but actually proves to be profitable over the medium to long term.

One of my ideas is to run the EA over the same number of trades in live as demo, so 100, and if it does not perform half as well I drop it. So if the profit factor in demo was 1.6, the minimum performance expectation for the first 100 trades in live should be 1.3.

Alternatively I have thought about promoting the best 15 EAs from the demo accounts to the live account, and at the end of each month I discount the worst performing 5 of the 15 and promote the next best 5 from demo accounts (provided their performance is better than that of the worst 5 in the live account).

Do you have any set criteria? Have you found that using a certain method allows you to minimise the risk of prematurely discarding an EA which performs well over the medium to long term? Really interested to hear feedback from Petko and other users on how you manage this process.

Thank you

[Petko Aleksandrov]

Hey Steve,

You are doing a great job! I have been through all of that…I tested 1000s of EA on dozens of accounts. But the more I was adding, the more complicated it was.

So to make it simple, I started using the Validator in EA Studio and recalculating strategies over the new Historical data. This way, I do simulated Demo trading.

Not sure if you watched some of the videos where I explain it. For example, in the Last Month Top EAs course, I described it in lecture 6.3.

Regarding the live account, I try to keep it the very same as with the Demo. You said that you would consider an EA as a losing one if you ” it can never have more than X negative profit days in a row”. So why not follow the same in live? This way you will have the very same thing on Demo and Live.

If you make it stricter on live, you will miss some decent EAs performing well on your Demo, but you limit them more on the live…

[SteveM2030]

Thanks Petko, that’s useful.  Its an exciting stage when the first EAs on demo are proving themselves worthy of going to a live account. I have decided that for each EA going into live, I will give it half as many trades as it had over demo to hit my minimum 1.30 profit factor criteria. So If it hit 1.45PF over 110 trades in demo (100 being the minimum), I will give it 55 trades in live to hit minimum 1.30.  That’s enough time to allow the trades to synchronise between demo and live for the same EA, and then some more time to even out some good / bad spells and see, something closer to its true long term performance. I have in mind that any EA that drops below 1.2 profit factor over its total time on live, will get dropped. That way I know it has always contributed profits to my live account, but below 1.2 means it is using valuable margin that could have been given to an EA that performs more profitably.  Ill see how this second rule works out, that’s just an idea at this stage.

I would look at that video as I am curious about the simulated trading, but it is behind a paywall. (I have paid for EA Studio access only). Thanks

[Petko Aleksandrov]

Hey Steve,

Glad to hear from you again. What you said is logical, and I would be interested to hear more from your testing.

I will be happy if everyone using EA Studio or my EAs from the courses, join the Forum and test different things. This way, we would be like a team working together to maximize profits.

Do you actually wait for 100 trades on the Demo account? For me, that is quite a long time, especially if you are above the M15 time frame.

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