How to set proper RecoveryTradeLots and RecoveryMMC
The lots size of the recovery trade is very important for the normal operation of the WallStreet Recovery PRO. The half of the recovery trading logic is based on the lots size. Some of our customers don't know how to set a proper lots size. Therefore we have decided to make it more clear.
Forex traders must be very careful with the risk. There is a parameter called RecoveryTradeLots - it is the lot size of the recovery trade. Usually, this lot size is 3 times higher for EURUSD, 4 times higher for GBPUSD and 5 time higher for the other pairs. Therefore, if you change the FixedLots, you must adapt also the RecoveryTradeLots. If you use AutoMM > 0, then you don't need to adapt anything. The robot will automatically adapt the recovery trade lots size.
Here are a few examples to clear things out. Let's say you don't use AutoMM (it is 0). In this case, FixedLots is taken in consideration for the lot size of the primary position. By default, FixedLots is 0.10 - this will be the lot size of your first order. If the recovery system triggers, it will open an additional position with lot size equal to the value of RecoveryTradeLots (if you leave it to 0, default value will be used). As we mentioned earlier, RecoveryTradeLots is 0.3 for EURUSD - it is 3 time higher. However, if your FixedLots value is 0.20, you will have to adapt RecoveryTradeLots to 0.6 - in other words, you guarantee that it is 3 time higher. Now let's say that you use AutoMM (5 for example) - in this case, your primary lot size will be calculated automatically and accordingly with your account's free margin. In this case, FixedLots is not taken in consideration. As well, for the calculation of the recovery lots is taken in consideration the RecoveryMMC parameter. RecoveryMMC is a coefficient. By default, it is 3 for EURUSD. In this case, you do not need to adjust anything. You can only change RecoveryMMC if you wish the recovery trades to be with different risk, although we do not recommend this.
For your information, the default values of the parameters we mentioned appear in the gray information box (if you don't change them of course).
Comment(s) (2)
5% risk is usually considered as a high for this EA. Keep in mind that when a recovery trade appears, the risk is increased several times (up to 5 by default) which may increase the DD in some cases. We always recommend the safest solution for our customers so we recommend MM up to 1. Of course, you are free to set another risk at your own discretion. GBPUSD is our best performer though, but we still do not recommend such high risks even for it.
June 08 2015, 4:50 PMHi..
June 05 2015, 6:17 PMA question about MM risk... Would 5% be considered medium or high risk?
I see another vendor is running the following settings and pairs.. Copied from their page.
Tertiary test: We have set up a demo account with 10,000 USD, and we have set up the EA on five pairs: EUR/USD, GBP/USD, USD/JPY, USD/CHF, and AUD/USD on M15 time frame, using 5% risk and recovery settings as follow:
Recover After = 100
Max Recovery Trades = 1
Recovery Min Profit = 4
Recover lots = 0.3
Hedging enabled
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FV Score Score 4.01
Net Gain 53.21%
Avg Monthly 51.16%
Test Duration 31 Days
Max Drawdown 21.43%
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So, it is still chugging along. But 31 days is not much of a test IMHO. .. Would 5% be classed as high risk? Or would it be okay to use 5% only on certain pairs? .. maybe eur33 and gbp30. I have been backtesting but my data isn't brilliant. Some help here please? Recommendations? .. Low , Med, High.