What can be done to make a very highly unprofitable EA Profitable? - page 3
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It's not an opinion, it's an illusion.
You're wrong.
Imagine simple unprofitable EA with single trade, for instance, buy GBP/JPY 151.50 (ask) -> out 151.00 (bid) (loss = 50 points)
For simplicity, assume, that spread is const and equal 10 points.
So, if we reverse this simple EA, we get next trade - sell GBP/JPY 151.40 (bid) -> out 151.10 (ask) (profit equal 30 points -> loss - 2 * spread).
Wow, unprofitable EA transformed in the profitable.
Complicate example.
Now, we have two trades:
buy GBP/JPY (ask) 151.50 -> out 151.00 (bid) (loss = 50 points)
sell GBP/JPY (bid) 150.80 -> out 150.40 (ask) (profit = 40 points).
This EA is unpofitable two - our loss is 10 points.
Average Profit (or Expected Payoff) is (40 - 50) / 2= -5
So, reverse it!
sell GBP/JPY (bid) 151.40 -> out 151.10 (ask) (profit = 30);
buy GBP/JPY (ask) 150.90 -> out 150.30 (bid) (loss = 60 points)
Average Profit is (30 - 60)/ 2 = -15 - EA still Unprofitable (!)
You can independently check situation, when Average Profit is -(2 * spread) (Profit and loss reverse EA will be 0).
Similarly, you can make sure if Average Profit is less -(2 * spread), so reverse EA will be profitable.
we can extend the result to any number of transactions with help of mathematical induction.
Q.E.D.
You're wrong.
Imagine simple unprofitable EA with single trade, for instance, buy GBP/JPY 151.50 (ask) -> out 151.00 (bid) (loss = 50 points)
For simplicity, assume, that spread is const and equal 10 points.
So, if we reverse this simple EA, we get next trade - sell GBP/JPY 151.40 (bid) -> out 151.10 (ask) (profit equal 30 points -> loss - 2 * spread).
Wow, unprofitable EA transformed in the profitable.
Yes, because of spread.
The other reason about why the reversal of "highly unprofitable" EA will not help to make it profitable one in most of the cases - is the following:
I remember one example/experiment which I did with one broker (it was long time ago): I opened buy trade and sell trade on almost same market price with same values of sl/tp, waiting ... and 2 trades were closed in almost simultaniously with opposite direction - buy trade was closed in profit and sell trade was closed in profit :)
A "highly unprofitable" EA will be so due to the spread and the spread still has to be paid even if the strategy is reversed.
Yes, because of spread.
The other reason about why the reversal of "highly unprofitable" EA will not help to make it profitable one in most of the cases - is the following:
I remember one example/experiment which I did with one broker (it was long time ago): I opened buy trade and sell trade on almost same market price with same values of sl/tp, waiting ... and 2 trades were closed in almost simultaniously with opposite direction - buy trade was closed in profit and sell trade was closed in profit :)
I understand what you mean. Nevertheless, if we make "reverse" we should make it in same time, when original EA make trade. I mean, if we buy gpb/jpy on 12:03:45, so we should sell gbp/jpy on 12:03:45, when we are reversing this trade.
But your description of reverse - it's not reverse. It's just another EA :)
Just some moments:
Of course, it may be good to have some settings/parameter in any EA such as 'reverse = false/true' ... but I agree: to find highly inprofitable EA is the same case as to find highly profitable one :)