Optional

In my quest for a passive forex investment with a starting bank less than $1000 I have opened a demo account with FxddAuto.com to test it out.

I wanted to see if it was possible to start with the minimum $500 trading minilots... but the demo only allows a $2500 minimum account start size for some reason... so I have set it to start with $5000 and trade full lots to simulate the minimum.

I picked 2 signal providers and 5 pairs from their available systems here: FX-PERFORMANCE

ATRChannel for GBPUSD and USDCHF

and

Quants-MP40 for EURCHF, GBPJPY and AUDJPY

I decided first up I would like to cover all major currencies if possible and hopefully a selection of pairs that isnt too correlated. (any expert advice on the bag greatfully accepted) Then I picked those providers based on their recent activity in the system and frequency of trades, more than long term record. I tried to avoid any system that showed more than a couple of hundred pips as max drawdown.



Week 1 - May 28 to Jun 1

Start Balance: $500
Trades Closed: 9 (4 losers, 5 winners 55%)
Max Drawdown: -$269.30 (-313 pips 53%)
Pips for Week: -27
Final Balance: $474.52 (-5.1%)

Open Trades: 2
Floating P/L: $61.52 (+66 pips)


We came out the gate badly with 4 straight losers in the first 2½ days of the week (2 for each provider), resulting in that scary drawdown figure, but luckily we came back with 5 staright winners in the second half.

here are the closed orders for the week:

ATRchannel has a buy order for GBPUSD and a sell on USDCHF open at a nice profit right now, meaning next week should start better than this one at least

Jude

Thanks for sharing the results of your demo with FXDD. This is the managed that is being offered by Team Aphid of Forexfactory, yes?

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Optional

They have just been added to the platform and started sending signals on 29th May

FX-PERFORMANCE - Team-Aphid



One of the things the software does for you is plot a historical equity curve for whatever signal portfolio you have selected.

According to FXDD, if i had started with this bag of signals on January 1st this year with $5,000..... it would have grown to $32,000 by now!

http://www.hyiphound.com/temp/fxdd-curve.gif

Now that sort of historical performance would worry me the risk is way too high normally.. or is that the sceptical hyiper coming out in me?

kibitzer

I'm wondering if, assuming I started with the minimum deposit of $500 on a mini-account, it might not be better to just use one signal provider.

May I know what selection criteria you used for deciding on the signal providers?

I wish they allowed a demo-account with just $500 so the simulation would hew closer to the actual result.

gaby

Kibitzer selecting 5K and using whole lots is in effect like using 500$ and using 0.1 lots.

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opie999

I thought it was generally accepted that trading with $500 was pointless because fees, etc. would eat your profits.

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Optional

Yes I agree that most every MA I have seen in forex that starts with $500 fails... but I havent looked around for a while... so here I am testing if things have changed at all. This technology looks very tasty for the normal passive investor to me and worth looking at properly.

Gaby has setup her demo account to simulate a $1000 starting figure and hopefully a few more people will try some other small account configurations here so we can work out if this can work in real life.


I'm 312 pips up so far today with the signals btw!

phildunn

Thanks for sharing the signals performance. Do u trade live?

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Optional

The down side with using just one signal for 1 single pair is that you are 100% relying on that single system. If you can 'diversify' your bag of currencies and providers you should theoretically limit your long term losses. (and also limit potential short term gains)

Gaby already explained how to simulate $500... if you go into your portfolio builder... remove your signals... then change the .1 lots to 1 lot at bottom left, and click "set".. then reload your signals... it will recalulate your account back to day 1 with those settings.

I think the discussion of how to pick a signal provider is the most important one we can have here...

- As I was starting with $500 my basic criteria was to make sure my chosen signal providers did not open more than 1 or 2 trades simulaneously.

- I looked for systems that sent no more than 2 or 3 signals per week.

- I then scanned down those systems looking at the all time history looking for providers who showed a winning record over a series of pairs and also showed a history of max drawdown being no more than a few hundred pips.

- I picked 4 or 5 signal providers and then went to the section of the fx-performance site that shows details of the compnay and website etc.. then checked out what sort of info was available. I did a google search on 3 of them to see what was available and particularly liked what I saw for Quants and ATRChannel.

Quants have a big array of automated systems with a proven record and listings on a few reputable forex sites... The history of signals from their MP40 range gave me some confidence that system wasnt going to produce massive draw downs whilst still going for wins of 100+ pips.

The ATRChannel guy was a one man show that specialises in just 2 pairs and enters the signals manually. He uses trailing stops to lock in profit and tight stop losses.

- I then looked at the available currency pairs from these two... looking more closely at this month, last month and 3 month trading history data.

- I tried to pick a bag that covered all the major currencies and where not closely correlated or anti-correlated pairs. (I honestly ddont know how well this bag meets that aim.. but thats what I had in mind)

- I then went into the "Build Your Portfolio" section on the fx-perfromance website and selected the 5 pairs I mentioned I have and clicked Next to view a graph of the equity curve performance of the portfolio historically. I was pleased to find that the bag evened itself out so well it would have produced no drawdown at all if started in January this year... plus a huge profit in the last 2 months... so that was enough for me to get started

Optional

Hi Phil,

I spent a few months learning to trade myself in 2005... and learned enough to realise I do not have the temperament or love for it required to do it longterm.

I'm too much of a gambler at heart to happilly follow a technical system for too long

This is my attempt to find an avenue some of us lost hyipers might passively invest in forex without having to give their cash to a pool trader or trade hands on themselves.

Collective2 and the trade bullet software system they had last time I checked that out was far too hard for the average hyiper.. and way too unreliable.. and too expensive to subscribe to top signal services for low account sizer holders to play.

This system charges users 1 pip per signal rather than any subscription..which does not disciminate against the small account holder due to their pips being worth less.

I have not even tried to check the spread FXDD is working on... but suspect that is probably higher than average.

Any advice on how to work this better... or chosing signals and bag selection would be great btw