The Wall Street Forex Robot is a scalping robot which looks to bank just a few pips of profit at a time. There is no shortage of robots like this available on the market, but they generally tend to scalp during thin Asian trade when market liquidity can be a major issue which impairs the robot's performance on live accounts.
Well, the Wall Street EA is certainly different in that it has no such trading time restrictions and it will trade at all times of the day, hopefully when there is greater liquidity within the market and there is no problem in getting trades away.
It's also different in that it fetches its settings from the vendor's server each time that it starts. This means that the vendor can issue newly optimised settings which the EA will automatically detect and use, enabling it to stay at the top of its game without the user needing to manually update his own copy of the robot.
That's the theory anyway. I wanted to test the EA thoroughly to see if it could live up to this high level of expectation.
The Wall Street Forex Robot website is a typical single-page sales letter which makes plenty of claims about how good the EA is and takes forever to scroll down from top to bottom. I'm no fan of websites such as this but, as they go, the Wall Street Forex Robot website is one of the better ones, as it is well written and contains impressive graphics.
Like many robots nowadays, Wall Street Forex Robot comes in its own self-installer for quick installation and there is even an MT5 version of the EA included free within the purchase price for anybody wishing to run this platform
About the EA
The
Wall Street Forex Robot works on the 15 minute timeframe and seems to take its trading signals from a combination of several indicators which align together. The EA's main trading logic is protected inside its DLL, so it's difficult to know precisely what it's doing. Anyway, I'm more concerned about whether Wall Street Forex Robot works or not.
Each copy of the Wall Street Forex Robot can be used with unlimited demo accounts and up to three live accounts. The EA has the option of either trading fixed lot sizes, or of its own money management system which seems to risk a fixed percentage of the free margin on the account depending upon the distance away of the stop-loss.
The robot sends a fixed pip SL and TP to the broker immediately after opening an order. Once a trade is in profit by a certain amount, it then moves the SL to the order entry level so that the risk on the trade becomes zero. It only seems to adjust the stop-loss once to protect the position and it isn't a trailing stop-loss as such. Most trades are closed well ahead of the SL being hit, and the tests below will show that its average win rate is around 80%.
Setting Wall Street Forex Robot up
This is where I initially got confused because the manual starts by saying that the robot works on three currency symbols (EURUSD, GBPUSD and USDJPY), so I chose to run tests on all three of those symbols as per the manual. Having run those tests, and whilst in the process of preparing this review, I then noticed towards the end of the manual that the EA also seemed to work on the USDCHF symbol as well. I cross-checked on the website where I also found reference to the USDCHF symbol, so I decided to also run some tests on this symbol and include their results within my review.
The manual consists of 18 pages, of which half relate to installation guidance. There are a lot of user-adjustable external parameters within the EA (which I personally feel would make it a little bit confusing for novices) but, for the vast majority of users, only a few of those parameters actually need to be adjusted. This is because the EA seems to have two modes - an automatic mode where it sets everything using its default internal settings and the user just needs to enter the risk in percent per trade - and a manual mode where the user can over-ride the default settings and specify his own SL, TP and lot size, etc. For my purposes, I was happy to use the automatic mode and let the EA use the vendor's settings.
In addition, on the EA parameters page of the manual, it states that the EA can actually be used with any currency symbol and the user can choose which of the default settings from another symbol he wishes to use. For instance, if the user wanted to run Wall Street Forex Robot on the EURGBP symbol, he could apply any one of the four default settings from a choice of GBPUSD, EURUSD, USDJPY and USDCHF.
As I mentioned above, the
Wall Street Forex Robot also fetches its settings from the vendor's own server each time it is loaded onto its chart. This gives the vendor the opportunity to keep the EA tuned to current market conditions behind the scenes. The downside of this approach is that the user becomes reliant upon the vendor updating those settings at the appropriate times. Also, the EA only fetches the settings when it is first loaded, so I'm not entirely sure what would happen if the EA was just left to run on a VPS 24/7 and the vendor updated his settings. How would the user know that the settings had been updated? I'm presuming that the vendor would email his userbase to say that the settings had been updated and to suggest they reload the EA on the charts. It's a small point I know, but it needs to be considered nonetheless.
Given that the EA fetches the settings from a server, I wanted to ensure that they weren't just being curve fitted to current conditions, so the 10 year test was going to be more important than ever.
The Strategy Tests
Given that it's a scalper, I was careful to choose a broker with a realistic spread , so I chose Tadawul for the tests. Scalpers tend to prefer fractional pip (3/5-digit) brokers because their take-profit levels are small and easier reached using a fractional pip broker. Tadawul are a 4 digit broker, so I figured this broker should show the EA in as bad a light as possible for the purposes of getting some fair and representative test results. Tadawul's spreads are also fairly indicative of what the majority of users could expect to get throughout the times that the EA trades.
Given that the EA will work with several symbols, I chose to test with a risk of 2% as I didn't want the combined drawdown from running multiple symbols to be too excessive. In hindsight, I could have probably used a slightly higher risk level, but I was happy to err on the side of caution.
My 10 year backtest results are shown below. You view the full report in a new window by clicking any of the images.
Tadawul - EURUSD - 2.0 pip spread
Tadawul - GBPUSD - 3.0 pip spread
Tadawul - USDJPY - 2.0 pip spread
Tadawul - USDCHF - 2.0 pip spread
Despite working on other symbols, I elected to only test the four publicised symbols.
I did also test Wall Street Forex Robot with a couple of other brokers who use higher spreads than Tadawul. I haven't posted the results into this review, but I did notice that there was reasonable consistency in the same number of trades being taken between the different brokers. As would be expected, the net profit obtained from higher spread brokers was lower but, interestingly, the drawdown level and win rate didn't seem to particularly change as a result of using a higher spread brokers.
Conclusion
Despite being a scalper, the
Wall Street Forex Robot is not a prolific trader. On each symbol, it only seems to trade around 150 trades a year. This isn't very frequent for a scalper by any means, and I would have expected to see it trade several times a day, implying that there is some pretty extensive filtering going on behind the scenes to only select trades with the highest upside potential.
If it were only being used on one symbol, I would therefore have to say that it is not particularly good value for money. The worst performing symbol clearly seems to be the USDJPY, where the net profit was a rather modest 84% over the full 10 year backtest. Seeing as users would find themselves risking a 7% drawdown in exchange for this return, I suspect any user running this symbol alone would quickly find themselves frustrated, especially as it looks that each symbol can endure lean spells of being in drawdown for a few months at a time.
Despite this negative aspect, Wall Street Forex Robot looks to really come into its own though through its ability to use multiple symbols concurrently.
Using multiple symbols can be either a very good thing or a very bad thing. If every symbol tends to drawdown at the same time, then there's obviously a heightened risk of blowing an account which would obviously be very bad.
If, however, each symbol tends to drawdown at a different time, using an EA with multiple symbols can be a very good thing as the positive effect from symbols which are outperforming more than offsets the negative effect of underperforming symbols, and the balance curve tends to be a lot smoother.
To find out how Wall Street Forex Robot would perform using multiple symbols, I used a 3rd-party script to merge all four of the above reports into one single report. The merged drawdown of around 11% is no worse than any of the individual drawdowns, which makes this a major positive. One of the side effects of merging reports in this manner when an EA is using its own money management, is that any compounding effects are discounted because the EA would have taken higher lot sizes than in each individual test. This means that the performance would most likely actually be better than the merged report suggests.
To demonstrate the point I'm trying to make, the USDJPY monthly return is 0.51%, the EURUSD return is 0.92%, GBPUSD is 1.35% and the USDCHF return is 0.81%. Combined, the total average monthly return is therefore around 3.59% for all four symbols. The annual compound return would be about 52% and, applied to the $50k start balance that I've been using for my tests, the 10 year net profit would be $3.39m. This is is considerably more than the $426k which is suggested in the merged report where compounding is discounted, and it makes the EA look very good value for money!
Tadawul - 4 symbols merged
I did note that the EA does features a recovery mode, which is presumably based on some form of Martingale. Individual tests showed that worst case consecutive losses varied between 4 and 7 (depending upon the symbol), and the average win rate is 80% which probably isn't high enough for Martingale. Besides which, the EA looks to be profitable in terms of pips, so I wouldn't personally be inclined to use the recovery mode.
The EA does include a parameter to permit slippage. Given the nature of scalpers having a low TP value, I would personally set the slippage to 0 (zero), as the slightest amount of slippage could seriously impact profits going forwards.
Wall Street Forex Robot has been well and thoughtfully coded. It only runs one open trade at a time, so NFA hedging and FIFO regulations are no problem which will suit US-based users of the EA. In addition, it also works automatically with both ECN and 3/5 digit brokers.
The only limitation I can see is that the SL and TP values are fixed. Markets change constantly and I would personally prefer to see a more dynamic stop-loss and take profit system which is adaptive to the market. I guess that's why the vendor is employing the server-side optimisation approach, as this will enable him to regularly adjust the SL and TP values to the current market.
It's difficult to know how effective this approach will prove to be in the long term but, even without any optimisation whatsoever, it's worth noting that the EA certainly looks profitable over a sustained period using its current settings.
In the UK, we have a saying, "If it ain't broke, don't fix it." Based upon what I've seen of it so far, Wall Street Forex may not need any fixing.
Forward Tests
