Hello, Matthew. Slowly but stably your Expert Advisor comes close to leading positions. How did you estimate you EA’s possible success before the Championship? Did you expect to see it in the Top 10? Or, perhaps, you are sure it will become a leader?
I went through several optimizations and re-optimized it once before I sent it in using about a year’s worth of data. I wouldn't say I expected it to be in the Top 10, but I am not very surprised that it is. I will be surprised if it finishes in the top 3, because there are so many competitive EAs in the competition.

Could you, please, describe the trading strategy you are using?
It’s a type of crossing moving averages. When one crosses above the other, you enter a buy, when it crosses below, you enter a sell. The code is set up to be able to use TakeProfit and StopLoss levels, but the code running on the competition has very high TP and SL, so that it will likely never hit them. It simply waits for a signal in the opposite direction. So it is always in a trade, switching back and forth between a buy and a sell.

Could you, please, explain the usage of such large Stop levels?
The EA takes care of itself: When the trade starts to go the wrong direction, the EA switches position, so there is really no need for stops. If the market suddenly and drastically changes, then it could have a bad result, but that’s money management that needs to be in place for live trading. For this competition, I assumed a bit more risk by expecting that there would be no very drastic and sudden changes in value. Even if there are some, there’s a 50% chance that the market will work for me and not against me!

None of your trades was closed by a stop order. Could you tell us how positions are closed?
Again, the EA will close one position and open another when the Moving Averages cross. The same signal that is used to open a position is also used to close the previous position.

Your orders have large StopLoss and TakeProfit levels – 1000 points (10 figures). Actually, we can say they do not exist, because at the moment a position in 3 lots with a StopLoss of 1000 points means losing about $26 100. Can the EA close a position, in case of danger? Or will it experience a Stop Out (a forced closing if the account is smaller than 50% of margin)?
There is no added safety to keep the account from a forced closing; you just have to trust that the EA will get the signal to enter an opposite trade and close the position in favor of a better one. A more realistic StopLoss is something I do use in live trading.

Your Expert Advisor uses the Stop & Reverse system and is always in the market. Visually it is clear that not all the potential profit is taken. Haven’t you tried to use a trailing stop?
I ran an optimization adjusting the trailing stop, but there was no benefit. It is possible that if I did a full optimization, re-optimizing all the variables including a trailing stop, it would be more profitable. There are so many variables already that if I add more, it will take an unacceptable amount of time to optimize the system. It’s a trade off; do I want to spend more time optimizing other pairs and other ideas, or try to improve a system that is already very good?

You have written about using moving average signals. You also use your own two indicators. Could you, please, tell us about them?
They are both types of Moving Averages, custom indicators that react better to the market. Better than a standard moving average.

Why have you chosen this particular currency pair?
This pair gave me the highest profit in back testing. A friend of mine and his roommate uploaded a similar system on different currency pairs, but they were banned from the competition on suspicion that it was one person uploading two different EAs. It’s really unfortunate, too. They would easily be in the top 5. The system works on several different pairs, you just need to tweak the variables a bit based on back testing and optimization.

At the current moment the Z-account of your EA is 1.85, which quite precisely points at the negative dependence between trades (though only 15 trades are closed and it is hard to speak about dependences yet). It means that after taking profit the next trade is more likely to be a losing one. Didn’t you think about using this fact somehow? Perhaps, the dependence actually exists? What did testing before the Championship show?
Testing before the Championship did not show any relation between consecutive trades. It is just the way the EA is reacting to the market right now. I will probably look into it for a future addition to the code if this negative dependency persists.

The main profit acquired by the EA up to now was gained from Sell orders, though these short positions had only two profitable trades. Was it made intentionally – getting profit seldom, but to the point, or is it only accidental?
It's just following the pair; if the pair were channeling or trending in a different way, then the profits and losses would be from different directions. I guess you would say it was accidental.

What do you think about the fact that some Participants gave public access to codes of their Expert Advisors?
In my experience, there is no “set it and forget it” code. All EAs, especially the good ones, need to be optimized and updated from time to time. So distributing the code for free just means that many people will just stick it to a chart, make a bit of money, and then eventually lose it. If you learn the code and optimize it yourself, then you can keep it up to date and continually make money. I have given enough information here for dedicated people to work towards the same code I have. If you’re not willing to do that, then you won’t have a successful EA even if I give out the code.

Do you trust automated trading in real life?
I have made a lot of money in the past using EAs. I have reached a point where I want a more stable investment, even if it is less profitable. Currently, I do not use this EA for automated trading, but I do use the buy and sell signals it generates, and an indicator. I trust automated trading, but I'm not convinced that it fits with my style of trading.

Thank you for the interview, Matthew.