Anyone know of a profitable EA with new 30:1 leverage rules? | Forex Factory

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Anyone know of a profitable EA with new 30:1 leverage rules?

  • #1
  • First Post: Edited 4:29pm May 27, 2018 3:51pm | Edited 4:29pm
As you all know -or should know- all of the EU brokers (UK FCA brokers included) will be moving to the new 30:1 leverage rules in the next few weeks...

Does anyone know of an EA that is profitable under these leverage conditions?

Thanks
  • #2
  • May 27, 2018 9:34pm May 27, 2018 9:34pm
Hey, I don't think leverage has anything to do with profitability... You will just need to have way more money in the account to run the EA the same way. Try this simple formula: New Funds Needed= (Previous Leverage / New Leverage (which is 30) ) * Current Account balance needed to run EA

EA profitable at 300:1 will still be profitable provided you have extra funds (10 time the funds you had originally)

Unless there are other new rules that stop the EA functioning properly, the EA will be the same.

Best Regards,
Tzamo
"Work hard, put in the effort, and follow your dreams..." -Me
  • #3
  • May 27, 2018 10:57pm May 27, 2018 10:57pm
Quoting tzamo
Hey, I don't think leverage has anything to do with profitability... You will just need to have way more money in the account to run the EA the same way. Try this simple formula: New Funds Needed= (Previous Leverage / New Leverage (which is 30) ) * Current Account balance needed to run EA EA profitable at 300:1 will still be profitable provided you have extra funds (10 time the funds you had originally) Unless there are other new rules that stop the EA functioning properly, the EA will be the same. Best Regards, Tzamo
Theoretically - but in fact the profitabilitiy shrinks to a level where it hardly can compete with other asset classes like classic shares for example. Actually nearly all grids/martingales are of no real use anymore trading with an EU broker once the restrictions are in place.

But to answer the question from meyoik: yes!
  • #4
  • May 28, 2018 1:09am May 28, 2018 1:09am
Quoting tzamo
Hey, I don't think leverage has anything to do with profitability... You will just need to have way more money in the account to run the EA the same way. Try this simple formula: New Funds Needed= (Previous Leverage / New Leverage (which is 30) ) * Current Account balance needed to run EA EA profitable at 300:1 will still be profitable provided you have extra funds (10 time the funds you had originally) Unless there are other new rules that stop the EA functioning properly, the EA will be the same. Best Regards, Tzamo
Quoting Drolph
{quote} Theoretically - but in fact the profitabilitiy shrinks to a level where it hardly can compete with other asset classes like classic shares for example. Actually nearly all grids/martingales are of no real use anymore trading with an EU broker once the restrictions are in place. But to answer the question from meyoik: yes!
Hi Guys,

I know it's a tough ask...I knew it when I posted this...but as you can imagine...I had to ask...

Thanks for the formula, I applied it to the EAs I have, and like Drolph mentioned, the gain is minimal...at least with my EAs, so hopefully, someone will post some glimmer of hope here...

Thanks guys!
  • #5
  • May 28, 2018 1:38am May 28, 2018 1:38am
Quoting meyoik
{quote} {quote} Hi Guys, I know it's a tough ask...I knew it when I posted this...but as you can imagine...I had to ask... Thanks for the formula, I applied it to the EAs I have, and like Drolph mentioned, the gain is minimal...at least with my EAs, so hopefully, someone will post some glimmer of hope here... Thanks guys!
If/when European regulated brokers move the the 30:1, you could always move to an Australian regulated broker, who are not going to mirror the European regulations (at least for the time being).

There is also talk in the industry that Euro regulated brokers are opening offices in Australia and although they are not able to offer to move their Euro clients to the Australian office if you ask they will move you.

That's the subtle difference. They can't tell you to move but you can ask them to move.
  • #6
  • May 28, 2018 12:15pm May 28, 2018 12:15pm
Quoting londonboy
{quote} If/when European regulated brokers move the the 30:1, you could always move to an Australian regulated broker, who are not going to mirror the European regulations (at least for the time being). There is also talk in the industry that Euro regulated brokers are opening offices in Australia and although they are not able to offer to move their Euro clients to the Australian office if you ask they will move you. That's the subtle difference. They can't tell you to move but you can ask them to move.
Thanks londonboy, would you know of any EU broker that is doing that?
  • #7
  • May 28, 2018 12:59pm May 28, 2018 12:59pm
Quoting meyoik
As you all know -or should know- all of the EU brokers (UK FCA brokers included) will be moving to the new 30:1 leverage rules in the next few weeks... Does anyone know of an EA that is profitable under these leverage conditions? Thanks
Even, I don’t know with 1:500 trading leverage! I have such a bad experience on trading EA. For me, only manual trading is real.
  • #8
  • May 28, 2018 9:43pm May 28, 2018 9:43pm
Quoting VEEFX
{quote} Think again about this formula please. It is not accurate (or should I say, it applies only to certain style of trading) Margin definitely affects profitability. You NEED more margin to spread your risk across multiple positions/pairs but if you are a single-pair-one-position-at-a-time trader then it won't matter. I have no idea why this idiot has blocked me on this thread. Perhaps I have pissed him somewhere else lol Feel free to post my response on his thread. So what is...
Dear Drolph and VEEFX,
Thank you for pointing out those flaws, it was just a thought that I wanted to start a discussion with and I am no expert in EA margin optimization. VEEFX you are right that it only applies to only a few particular type of trading and I lacked the interest in finding the actual effect on other types/ systems.

You also suggest trading frequency as an alternative to leverage, could you please give a comparison example of a system/ strategy with leverage 300:1 and when that is taken down to 30:1 leverage. How would you use frequency in that case?

So, I think I understand a bit more now, and please do correct me if I am wrong . Since leverage is a double edge sword... Any system/ Strategy/ 'Group of trades' that has a success rate of more than 50% will be less profitable. And the more accurate, the less profits will be made over the trades. I initially assumed the leverage would only affect the amount of margin required to hold a position, but now maybe I think it will affect the total profits/ losses of a group of trades based on a strategy.

meyoik and contributors, is it correct to think the type of EA's that will be profitable with the new 30:1 leverage would be those that have a Low success rate (5% to 50% winning trades)? But profitable overall by having large risk to reward ratio. Hehe anyways, please take my posts with a grain of salt on this matter as I am an Aussie and for the time being not affected by the leverage issues as the unfortunate traders in EU. Would love them to come over to AU

Kind Regards,
Tzamo
"Work hard, put in the effort, and follow your dreams..." -Me
  • #9
  • Last Post: May 29, 2018 12:47am May 29, 2018 12:47am
Quoting VEEFX
{quote} I should have included this in my response. My bad. You can open a new demo account with any custom amount and leverage level to test your EA. It's your strategy. You need to fully own it, test it, ensure it performs under all account types and market conditions. I am just sharing my experience as I had to deal with this also. Leverage will affect any strategy (especially optimized which I am against). It is very hard to have a strategy that will work on all account leverage levels and amounts in my experience (with a multiposition strategy)....
Dear VEEFX,
Thank you again for taking the time to respond to me. Stuff as simple as leverage seems like it can be so easily overlooked by those wanting to create and test their strategies. You are absolutely right, and I appreciate you sharing your experiences. Will be doing my own testing on this for sure, and position sizing is something that I am playing with at the moment

Kind Regards,
Tzamo
"Work hard, put in the effort, and follow your dreams..." -Me
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