Forex Megadroid EA Review and Performance

[pharoh777]

Forex Megadroid EA

Here is the first review of an EA that made it into the portfolio. I have used this one since it was released and has never had a losing year since I bought it. You can click the link at the top of this post if you decide to purchase it. The creator of this EA has a promotion going on at the moment and Megadroid is available for purchase for only $79. I believe that I paid $150 for it when it was released.

What is Megadroid EA?

The Megadroid Expert Advisor was released in March of 2009. I remember there being a really big deal about this one when it was released. The EA landscape at that time really had just one dominant player and that was FAPTurbo. But the buzz from that EA led to the hype surrounding Megadroid. It was supposed to be almost 100% accurate and it was so reliable that you could take high risk since even when it lost it had a "recovery mode" also known as "martingale". It would double the order size until profit was returned and could do so comfortably because it had such an amazing win %. The company's backtest results were amazing and it seemed to take winning trades every single day and would make around 2 a day, every day the market was open. I jumped in and found out what it was really all about.

Forex Megadroid is an Asian scalper that operates only under "ideal" conditions which from my experience means it only trades when volatility is low, and liquidity is average or above average for the Asian session (which would be very low for London, and NY). It trades only the EUR/USD pair on the 1-Hr timeframe. It hides its true take profit and stop loss but according to my real trading the real maximum t/p is around 15 pips (16.6 being my max) with the AVERAGE win coming in at 7.34 pips. The maximum stop loss experienced in 2011 was -79.6 pips. Although, when you take into account all the -1 pip losses (it does this when a trade is opened that never reaches profit or enough profit and enough time has elapsed. When price gets back to -1 pip, Megadroid closes position) the average loss is only -7.30 pips. So kind of hard to judge just based on that info BUT what we do know is that the reward/risk ratio for a max 80 pip stop to a max 15 pip t/p gives us .1875 or -5.3 R/R which means that for every $1 we stand to make, we risk $5.3. That means to be profitable we must win more than 5.3 times or win more than 83% for every loss at full s/l & t/p. But since we see in practice that the average win is 7.34 pips and the average loss is slightly less at -7.30. That pretty much puts us on an actualized 1:1 r/r ratio which is much better, meaning that anything over 50% win should be profitable. You see, in practice; projected r/r can be very different than actual r/r and one must be careful when checking numbers to see how consistently an EA hits full t/p and full s/l. In the case of Megadroid, full s/l is relatively rare, but if for some reason, full s/l got hit more than normal, it could tilt the numbers away from being very profitable. We will get to this later, but it is DEFINITELY worth noting here that you will find VERY, VERY different results from Megadroids own statements. They get full t/p way more than in I ever have seen, and they produce WAAAYYY more trades than I have ever seen the EA do in real life.

Which brings me to how often this EA trades. 71 times in 2011. Yup, barely more than 1 per week. Quite a contrast from the 10 trades a week they usually show in their statements. My real life experience is that Megadroid chooses to skip whole weeks of trading throughout the year, and the weeks it does trade, it does so at the tune of 3 trades per week and the most I've ever seen (banner week for Megadroid was 5). It DOES NOT trade Monday (except in vendor statments) and DOES NOT trade Friday (again, except in vendor statements). So how can an EA that trades a little more than once a week at +7.34 pip average win produce a 600% return in a year? Simply, it doesn't. Period. Hasn't been my experience, or any other person I have ever known to use it on a real account. I imagine if you knew which ones were going to win, you could jack up lot size right before it traded and then turn it down before the losers......But if you can do that, you don't need any EA to trade with and you should already be a Trillionaire. The rest of us without psychic ability are going to have to use numbers, facts and reason to learn how to trade. So again, you might be scratching your head, with so much funny business, is it even worth it? I'm going to have to say yes!! But that yes comes with a reality check. The performance speaks for itself, but doesn't speak in the same voice as the vendor.

Why Megadroid Made the Portfolio:

Quite simply: RELIABILITY AND STABILITY
Megadroid performs exceedingly well at what it does well and that is choosing calm conditions to trade and winning most of its trades. It is the ONLY EA I use that I have almost ZERO fear to leave running if I were to go out of town and not be able to access my account. It doesn't trade much and you know you will never be exposed very much during any given week.
Megadroid has a VERY smooth equity curve overall because it rarely hits full s/l and most wins are very consistent. Any full s/l hits the equity curve pretty noticeably but doesn't deform it to much because I use low risk % for such a high win % EA.
It doesn't work in wacky markets. I almost have a "megadroid" rule or one I used to use stated that: If Megadroid was trading that week, the markets were normal enough to make manual trades in. There was a surprisingly high correlation to my win % & # of trades Megadroid took during the same week before I learned how to navigate more difficult markets thanks to Marc & Co. at Forex Mentor Pro. So much applause for this EA being rock-solid on preventing risky trades. I know we have a rule against martingale EAs but it actually works for Megadroid thanks to high win % and absolute consistency in achieving this fact. It only doubles once, until prior loss is replaced. It doesn't keep doubling unless an extremely rare event happens like it losing twice in the same week (I can't recall that this has happened more than 1 time since release in March, 2009). To be happy with this EA, you must be happy with a small return on a yearly basis, but not having to worry much about how you got it. On to actual performance numbers.

Forex Megadroid Live Results for 2011: LIVE ACCOUNT 5% RISK

Net Gain: +12.96%
Trades: 71
Total Win %: 86.96%
Total Pips: +359.9
Average Win: +7.34 pips
Average Loss: -7.30 pips
Best Win: +16.6 pips
Worst Loss: -79.6 pips
Max Drawdown: -4.4%
Profit Factor: 6.38 (fishy but attributable to the fact that almost NEVER hits a full stop and most stop losses are -1 pip). Based on this number we could expect a huge return if it traded more often. Again, a reason any single number can NEVER be used to judge an EA.

The trick to make this pony work is never to exceed 5% risk. It is very tempting to increase this number but keep in mind a 20% swipe to your account takes a 25% return to replace while a 5% swipe only takes 5.3% to replace. That is not to mention the psychological effect of losing 20% in one shot (I have been there and MUCH worse more times than I care to remember and this is PRECISELY why you will always find pretty conservative EA trading from this humble tester!). A 5% loss to your capital is pretty easy to bounce back from but having to produce a 25% return after taking a huge loss is not fun to experience or deal with. It tends to lend itself to taking even more risk which can turn into catastrophic loss (I have blown 80% of an account in 5 HOURS very early in my trading career)


The whole goal of our site here is to give all the most accurate information regarding each product tested and let YOU make the decision based on balanced information. You are going to get both sides of the coin here. I'm putting the bad stuff up front so you can see the difference in the claims vendors can make versus real, live performance under real market conditions. Remember our goal is to separate advertising from actual performance and make decisions based on rules and giving ourselves the highest probability for success before we expose our hard-earned capital.

Remember a separate thread will be created to discuss the settings that achieved these results and real time performance. I ask that this thread be used to discuss the "meat and potatoes" of how this system works and what value it may or may not have to our portfolio.

My next thread in this forum will be to discuss the infamous Million Dollar Pips! I will create that thread very shortly. I know many here have been following Marc's results which were up slightly in 2011. I want to inform you all that I had a different experience. My live account that housed MDP improved by 198% without any rebates on MDP Eur/Usd trading alone!! I want us all to have access to the opportunity to make the most with all our EAs and I look forward to discussing all of them with everyone! In the meantime, please make use of this resource to share ideas and respecful debate over Megadroid!!

Kindest Regards,
Omar

[capsmart]

Hi Omar
I was using Megadroid myself for more than a year till I gave up. I had the same experience you mention but it was sometime between 2009-2010. Megadroid was the reason to start using a VPS so I learned from this experience as well.
What I did not like is that the money made in weeks was lost in one trade.
After a consecutive loss I stopped using the revenge mode.
I also noticed that just minutes before the robot starts trading, spread increased. I do not know if it was just my broker but usually the trade started with a handicap. I thought using it with a fixed spread broker but a 4 pip spread was just too much.
So to conclude for me it was a break even robot. Maybe it was making some profits but anyway a 10-15% a year is very little since I would never trust an important amount to a robot that would trade while I sleep.

[raa]

Pretty much all brokers rise spreads around 10 PM London time, so-called "cut", as they roll-over their books and inventories into a new day.

[pharoh777]

I was not aware of that raa, Thank You!! I had always wondered that since so many scalpers trade that time. I have heard so many different theories. That makes more sense.