|(3.5 / 5)|
|License:||1 real account|
GPS Forex Robot is another ambitious (read ambiguous) project by Mark Larsen. After launching the GPS Forex Robot, Mark and his team has upgraded the original version to bring in a few additional features. If you’ve already burnt your fingers with GPS Forex Robot, this review won’t matter much to you.
Nevertheless, here’s a detailed review of GPS Forex Robot 2. This is yet another Forex EA that claims to give 98% ROI. The founder of this EA, Mark Larsen is almost promoting the EA as a ‘wonder boy’ that brings windfall gains! GPS Forex Robot 2 is being promoted as an improved version of the original GPS Forex Robot which is twice as much safe and brings in better profits.
In addition to bring great profits, Mark promotes it as highly intelligent EA that adapts to the market conditions and even gives you the flexibility to change all the parameters to make this EA trade as per your trading style and comfort. There are videos and tutorials in the Member’s Area for the benefit of the traders.
GPS Forex Growth robot trades both GBP/USD and the EUR/USD currency pairs. It is basically a scalping EA that trades 24 hours a day, 5 days a week. One good thing about this EA is that it does not trade just during the Asian trading session.
As mentioned by the author, GPS Forex Robot 2 follows a reverse trading strategy to offset the losses incurred by the EA. It’s a fairly simple trading strategy called stop and reverse, that opens a reverse trade when the market goes against the trade direction. Simply put, if the open buy trade of GBP/USD goes in red, the EA opens a sell trade for the same currency pair in an attempt to minimize the losses and gain even when the trade does not go as expected.
In an attempt to compensate quickly for the losses, the GPS Forex Robot version 2 uses the strategy of increasing the trade size. When a forex trade is reversed, the lot size is dramatically increased to 9 times. In fact, the back testing reveals the trade size was increased by several times to make good the loss occurred from the previous trade.
So, in nutshell, the forex EA uses the Martingale strategy which in common parlance means that you play double, chipping in more money to make up for the earlier losses. While this trading strategy may prove to be good, it has 2 inherent problems- First, you need to have a huge, huge pocket to trade and sustain in the event of consecutive losses and second, if the market is in trending mode, you are destined to lose a whole lot more with this strategy.
The GPS Forex Robot version 2 is upgraded to trade the GPB/USD trading pair. A new feature of trailing Take Profit, which was not available in the earlier version is been added to the upgraded version. Plus, one can find a host of videos and tutorials in the Member’s Area.
Another feature which Mark has put up on their website is that the EA finds the ideal settings on its own and trades accordingly.
Again, for the experienced forex traders, one of the features is that one can optimize all the parameters and tailor it to your specific needs. So, if you are an amateur trader, this feature might not be of interest to you.
The EA trades at zero hours GMT with a stop loss of 90 and profit of 4 pips.
The EA was back tested over 4 years and a few months on the EUR/USD pair in 1 hour time frame. While the back test shows phenomenal gains of $100952 from a $10000 account. The drawdown is 20%, which is tolerable limit. The losing trades stand at 11%, while the percentage of profitable trades is 89%. That’s about the good news.
Now, the bad news-the average loss trade stood at whopping $824, while the average profit trade $219. So, you see how deep your pockets need to be?
Also, the trading strategy seems rather odd. Take for example, one of the trades on May 27th 2009 took a heavy toll $919 on just lot of EUR/USD trade. After taking the hit, the EA entered a sell trade with a lot size of 6.8. The forex trade turned out to be profitable, giving them a profit of $904. But this is a risky strategy nevertheless, as there is no guarantee that the market would move in the direction of your trade every time.
GPS Forex Robot 2 EURUSD 2007 - 2012:
GPS Forex Robot 2 USDCHF 2006 - 2012:
A live Myfxbook.com account reveals a fantastic profit it generation ever since May 21, 2012, the day it had been registered. The live account shows an initial deposit of $100000. Till date, the account has been profitable all through the months, however, the growth rate has been declining.
The average pips of 4.6 per trade is a cause of concern, since it indicates the infallibility of the EA to the market changes. However, on the positive side, the EA trades at low risk and with it drawdown seated at just 10%.
Forex Monitor Forward Test
The prime cause of concern is the strategy itself. The killing combination of the stop and reverse along with the martingale strategy dramatically increased the lot size from 11 to 75, after incurring a loss of $10230 on Jun 8, 2012. Now, had there been a loss on this forex trade, it would have tanked your account by $71088! Even if you had a massive bank, if the losing streaks continued for another couple of trades, your balance would be virtually wiped off!
So, what’s not said clearly or rather what has been kept under the wraps is that there is no stop loss.
In spite of its fantastic performance in backward testing and forward testing results and some impressive results in the Live testing, the fact remains that the GPS Forex Robot has inherent problems. It’s Martingale and Stop and Reverse strategy is risky and is not suitable, unless you have money you can afford to lose. The win ratio is quite high as compared to the loss ratio, and overall the EA has not posted a losing month, yet you need to exercise caution while using this EA.