Hello Traders,
many people have asked me and continue to ask me how my strategy works and what is my exit strategy if things go wrong.
This is a brief description of how the Turtle EUR strategy works:
Turtle EUR use an Expert Advisor to manage trading operations, the Auto Money Management (the risk for each trade) is set to 2%.
The system run on my own server and, whenever possible, I constantly watch the open trade.
In the 90% of the cases the strategy open in the right direction and close the trade in a few hours, sometimes in a few days.
The remain 10% of the cases, when the strategy open in a wrong direction, after a loss of about 150-200 pip, it open a recovery trade in the same direction of the initial trade with a higher lot size (from 3x to 4x depend which pair is involved).
This way, thanks to small movements towards the right direction the strategy closes all trades in overall profit.
Actually the system works with EURUSD and GBPUSD currency pair.
Only one trade is open at a time.
I would not say that this is a typical martingale system. Martingale does not work the way that Turtle EUR works. The Expert Advisor opens only one additional trade and the risk is beforehand specified by me. Furthermore, the additional trade is triggered only during specific conditions, unlike more martingale systems. My point is that if you trade with reasonable risk, your account should be safe enough and long-term profitable.
This is how my strategy works, sometimes it can happen that the first trade goes wrong.
If the loss in pips exceeds the threshold value of 150, a recovery trade can be expected with a higher lot size.
But this is not an exact value, the distance in pips may be different, because the strategy wait for a good market condition to open the recovery trade.
Unfortunately I do not have a magic wand.
This can cause an increase in heartbeat, but for 10 years of backtest and 2 years of real trading the strategy has worked well and will continue to do so in the future.
The Plan B
Question: What’s happen if also the Recovery Trade fails and the price is not retracing enough (after all what has not happened in the past, sooner or later it can happen in the future)?
Answer: Actually I setup the maximum allowed drawdown for the account, his value is 30%.
This option is based on the current drawdown, which is the difference between the current account balance and equity.
Also if the trades remain open for more than a month (4 weeks), they will be manually closed.
Regards
Andrea Lanza
Oh, you reduced the Total Drawdown from 53% to 25%?
Thx for the summary!
Hello,
where did you read 53%?
The value of 25% I got from my backtests, I considered the fact that at most in 12 years the drawdown does not exceed 25% for both currency pair.
Regards
Andrea Lanza
In September 2017 Update Report you commented:
“The maximum allowed drawdown for the account is set to about 53%.
This option is based on the current drawdown…”
If I set the copying multiplier to x2, my lotsizes are doubled.
The consequence are:
– I have twice as high gain (at the moment about 6%)
– my maximum Drawdown when the failing recovery trades are closed amounts 50%
Is that correct? Is there anorher consequence?
I follow since may 2017. I love it and have much respect to your performance and success quote.
Sometimes in phases of drawdowns I join Turte with a second account, close to the point when a recovery trade is opened. This lateral entry enables additional gain, compared to the original system, after recovery.
At this point the drawdown potential is less than 25%, so I think about multiplying the lotsizes of these lateral entry Trades.
Well yes, if you double the lot you increase the gains but also the risks, keep this in mind if you increase the multiplier.
However, a 25% drawdown would be the worst event and we hope it never happens.
The idea of opening a trade in parallel with that of recovery seems very interesting, also because statistically speaking the recovery trade has never failed.
The problem is that you have to wait more or less the exact point when the recovery is opened and also this operation is done only a few times (thankfully).
However, you suggested an idea that I will consider to try to optimize the strategy and it would be better to use this system on a second trading account to avoid further drawdown if the graph does not immediately turn right.
Have a nice day
Andrea Lanza
Of course this point is hard to hit. Before Turtles big Drawdown in October 17, I copied Turtle on Account 1 and on 4 other accounts one other system each. I watched Turtle recovering from small DDs very reliable several times without knowing of all that I understood later and what you wrote here. Then the October DD started. I joint on account 2 at 1%, on acc 3 at 2%. 4 at 3% and the fifth account at 4% DD. My whole budget at myfxbook was linked with turtle and the DD became bigger and bigger. It became a very exiting week for me 😉
Unfortunately not a profitable on, because I had not enough faith in Turtle yet and disabled further trades on account 2 to 5. Overall no win no loss.
After this event I began to understand the recovery trade process and got a feeling for the Entry point.
Could it be possible to put such a strategy into a separate ready-to-copy System at myfxbook? Could be called Turtle 2 😀
One more Idea:
The easiest way of setting up such a system would be Turtle “Recovery Trades Only”, I guess. This would provide only one or two handful of trades each year. It could be activated for example together with another System of myfxbook, to use the money on the Account more efficient (a succesful other system assumed).
Second possibility: Turtle “Drawdown Entries”.
If Turtle 2 could open trades that already have a drawdown of about 1 or 2 or 3 … % at Turtle 1, much more Trades could be performed, included the recovery trades. There would be smaller additional profits, but more in number.
Which Possibility is the best, could be found out by backtests maybe. I don’t know what s implementable, I just want to give some ideas.
I have another Question, regarding a long-term common future:
At the moment I use a Pro-Account at Broker Think Markets. I have Slippage of about 1 pip and there are some commision costs per lot due to pro-Account. Without, the slippage would be 2 pips, I guess. Is that acceptable or would you recommend to copy on Alpari Accounts?
If plan B will happen. So if the draw down will be bigger dan 25% and there will be a big loss do you continue trading with Turtle eur? Of will you stop the system? This is important because this gives a opportunity to recover the loss. I really hope that plan B will not happen.
Hello,
in my simulations it never happened to touch 25% drawdown.
If this happens it would be very difficult to recover this situation, that’s why in the remote event that this could happen I would decide to close the trades in order to lose only a quarter of the entire capital.
Regards
Andrea Lanza
I think Coen means to recover the 25% longterm by continuing trading after closing the bad trades.
Hello Andrea,
I just purchased the EA , do u mind sharing your Turtle EUR set file…
Been following your signal on demo for a while, now.. Thanks.
Hello,
I just created a new post where I explain how to download Backtests & Settings for Turtle EUR.
Regards
Andrea Lanza
Thanks, Andrea, playing around with your set files.
I’m beginning to understand the settings a little.
Also What about topping up account once it hits 25% of capital drawdown? I think this would be a good strategy in case of a big impact
Hello,
Topping up the account when it is in heavy loss seems to me very risky, if the signal reaches that level of drawdown I think that there would be very little chance of recovery and therefore better to close in strong loss than to lose the entire capital.
Regards
Andrea Lanza
And after that?
Will you do a new start with the remaining 75%
Hello,
I do not want to think about this bad news right now, it’s been fine for over 2 years now and I’m confident that Turtle EUR will continue to work well for a long time.
Regards
Andrea Lanza
Good attitude, didn’t want to stress you.
Good performance this week so far!
Regards!
Hello,
thank you.
I made some small changes to the parameters of the GBPUSD pair and now it should be slightly more performing.
Regards
Andrea Lanza
I’m using Turtle EUR through Myfxbook and the last trade was on the 6th of September. Did you stop running it?
Hello,
no no the strategy is working properly.
Some weeks trades more than once a day, some weeks only one trades and sometimes nothing at all.
But I prefer in this way, better less trades but more safer with less recovery.
Regards
Andrea Lanza
Hi Andrea
Keep up the good work. I have a number of accounts that AutoTrades via MyFXBook with your system. I just wanted to check that all is still running well because there does not seem to have been a trade since 6 Sep 2018.
Thanks
Hello,
no no the strategy is working properly.
Some weeks trades more than once a day, some weeks only one trades and sometimes nothing at all.
But I prefer in this way, better less trades but more safer with less recovery.
Regards
Andrea Lanza
Actually, a new recovery trade is in progress. This is alway an exiting phase.
Andrea, is a revovery trade automatically opened at 150 Pips resp. about 4% DD or do you open it manually depending on the market / signal situation?
Hello,
the Recovery Trade was opened by the Expert Advisor.
For GBPUSD the distance in pips is 145 but this is not an exact value.
The EA wait for a good market condition to open the Recovery Trade.
Now we must wait that the trades will be close in overall profit, hoping that the Recovery Trade retrace quickly.
Regards
Andrea Lanza
can someone recommend a broker to copy your trades on myfxbook?
Hi,
I use ICmarkets with no problem
Think Markets.
Slippage mostly under 2 pips
do they add a mark-up to spreads? if so, what is the mark-up?
I want to buy this ea, can you give me the link?
Hello,
yes of course: https://www.wallstreet-forex.com/
The name is “Wallstreet Recovery PRO Evolution”.
Regards
Andrea Lanza
how come the Wallstreet Recovery PRO Evolution opens more trades than yours?
Hello,
I use different settings.
I think that my configuration is more stable and long term profitable.
If you look at the official signal on myfxbook (https://www.myfxbook.com/members/forexwallstreet/wallstreet-recovery-pro-20-evolution/1934826), you will see a higher drawdown and more recovery trades than mine.
Less but safer!
Regards
Andrea Lanza
Is it possible, to run turtle with MT4 and with the settings from the download section on my own server or PC to avoid slippage as with copying via myfxbook?
I am new to MT4.
Hello,
the answer is no.
You must have your own copy of the Expert Advisor and then upload my settings, if you want to have the strategy running on your PC.
Alternatively you must have an account with my broker Alpari, in this way you can copy my signal with the PAMM system and you pay a fixed fee based on your earnings and you don’t have problems about slippage, spread etc…
Regards
Andrea Lanza
I am going to buy the EA. Slippage is simply a to big problem and causes to much performance losses.
Was there a special reason for running it on Alpari RU for you?
Do you know anything that argues against broker Think Markets?
I am study the manuals, if I have Questions (for example about replacing the settings with Turtles), I can ask you hopefully?
Hello,
there is not a particular reason why I use alpari, it was my first broker and so far I have never had any problems.
Other brokers unfortunately I do not know, if you buy the engine it is good to do some backtest and maybe test it first on a demo account, because the EA behaves slightly differently with different brokers.
If you have problems with the settings ask me, you can also download the settings that I publish monthly on my blog.
Regards
Andrea Lanza
Yes of course I want to run the EA with Turtle Settings, cause I loose about 30-50% of your gain by Slippage.
Furthermore I want to enter the EA in its drawdown phases on a secondary account. Same I want to do with Turtles DD phases (Enter at about -150 pips/ -4%). I think this can cause good additional profits.
At the moment I run Turtle with multiplier 2.0 on myfx and I am going to reduce it step by step. If I want to run the EA on my own with Turtles settings, think I will have to change the Lotsize Settings somewhere, right?
Hello,
yes you can change the lot size with the fixedlot parameter or with the AutoMM parameter.
The automm set your lot size accordlyng with the size of your equity.
But in the manual you can find a detailed description.
Regards
Andrea Lanza
If I change the AutoMM Parameter from 2.0 to 4.0 (multiplier = 2, like on myfxbook), will this affect the lotsize of a recovery trade?
Hello,
yes of course.
I do not recommend to set up the risk level too high, verify that you have enought equity to do this.
It’s better also to make some backtest on your account first.
Regards
Andrea Lanza