The Fed Makes Money Different Ways

Posted on May 10, 2024 by agruenbaum

Since January 2024, the Fed bot has been on my team. It hasn’t had the growth it did last year, so that is disappointing. Yet, it continues to perform and continues to find opportunities. The above graphic is available from myFxBook. It gives some insight into how The Fed has worked for me.

  1. The beginning of the year was slow. About 3/4ths of April had The Fed and Gold Digger in the same account, it is clear Gold Digger made a significant impact in the account.
  2. The Fed trades on 23 pairs. Most if not all of those are represented in the “Currencies Popularity” chart. Because Gold Digger is also in the account, XAUUSD was over 11%. I expect it to be higher in May.
  3. Both Risk and Holding Time are also broken out by Currency Pair. I am not enough of a trader to be able to decipher what these stats should mean to me. What matters to me is the bot keeps track of all of this stuff. It keeps the account productive and allows me to see weekly results.

Every week I keep seeing results from these bots. Now that the account has had an 8% month, I am hopeful this month can be a 10%. If not, I can make decisions on the risk I am willing to take on lot sizes next month. Each bot has a point where greed and success balance. I hope to stay on the right side.

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Tractors Doing Some Harvesting

Posted on May 8, 2024 by agruenbaum

If you are a farmer, this is the time you are planting some fields. But, if you are a bot farmer, you might be watching your tractors bring in a nice harvest. Thus far, May is looking very promising. I have shaken off most of the greed (If you aren’t happy with a CDs interest rate, you must be a little greedy, right?) brought on by the gold bots. I am now hoping to settle into those low 5-digit monthly returns for a few months.

While all five bots have contributed to my gains, The FED/Gold-Digger combo is providing well over 50% of this month’s profits. The percentage gain above is not based on my present balances. Yet, 13.17% is a statistic that makes sense to somebody. Is it based on my original balances? At the end of the month, I will need to see what the “real” percentage is for all of May.

Ideally, I will be content to set the cruise control and let it go until after Memorial Day. I have made mistakes and learned along the way. It would be great if these lessons turned into the predictable income I have been focused on achieving.

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Precision Bot Math

Posted on May 8, 2024 by agruenbaum
Those little yellow dots to the right of the big plunge are all gains.

After the big plunge down, the Precision bot has not had a losing trading day. Its “post-plunge” trading days have not compared to its “pre-plunge” closing, but there are no losers in the mix. The best “post” trading day came in at $165. The worst trading day was $38.34.

Since numbers speak best, let me use the percentage of the first 8 days of the month to project how this bot could do over an entire month.

I will repeat the assumptions/expenses I used when I did similar math for the Pro FX bot:

Expenses

  1. Since I bundled this bot with 2 other bots, my purchase cost was just over $3,000/bot. I believe the bot has gone up slightly since then.
  2. Every month, I must pay for a Virtual Private Server (VPS). This is approximately $35.99 or less.
  3. There are NO ongoing monthly costs. This bot has no monthly cost–EVER!

Assumptions

  1. Our account has $15,000. That is what the bot is working with.
  2. The lot size on trades is not changing for this projection. However, if they are conservatively increased as the account size grows, the account growth could be greater.
  3. The bot continues to make 3.78%/month. I don’t want anyone to think I am cheating, so I will say that the last three weeks of the month are paying the overhead. The overhead will include the VPS. This will also smooth things out when there are less volatile times and the bot does not have as many trade opportunities.
  4. Using these assumptions and this Forex calculator , we get this result:

Summary

Initial deposit:$15,000.00
Percentage:3.78% monthly
Effective Rate: 56.09%

Time: 12 months
Compounding: Monthly

MonthEarningsAccrued
Earnings		Balance
0––$15,000.00
1$567.00$567.00$15,567.00
2$588.43$1,155.43$16,155.43
3$610.68$1,766.11$16,766.11
4$633.76$2,399.87$17,399.87
5$657.71$3,057.58$18,057.58
6$682.58$3,740.16$18,740.16
7$708.38$4,448.54$19,448.54
8$735.15$5,183.69$20,183.69
9$762.94$5,946.63$20,946.63
10$791.78$6,738.42$21,738.42
11$821.71$7,560.13$22,560.13
12$852.77$8,412.90$23,412.90
With this very conservative projection, the bot would be paid off in 7-8 months. With less conservative settings, the bot purchase could be paid off sooner. I will mention that the less conservative lot sizes impacted my account negatively in the early weeks.

What could you do with an extra $500/month? Yes, it does take some money to make some money. As I continue on this journey, I hope others can learn from my mistakes and move into profitability more quickly. If interested in this Univerity of Options bot, please contact me for any guidance I can offer.

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The Aviator Woke Up

Posted on May 8, 2024 by agruenbaum

The Aviator bot has only been around for about three weeks. I was not begging it to do anything special for awhile. It was a nice surprise when I logged in this morning and saw it used its muscles overnight.

This is copied from my daily statement from OX Securities. A $20,000 account is up nearly 3% on these closed trades. This chart gives an indication what the commission and swap fees are on a “average” set of related trades.
While the Aviator made $538 in trades on Tuesday, it is still actively engaged in trades that are reducing the value of the account by $1,804. The Aviators job tonight, tomorrow and beyond is to bring these trades in at the highest profit. And, if needs to open any other trades, it will do what it needs to do.

The Aviator is a unique bot. It concentrates on only 3 charts. Other bots are “experts” in up to 23 Forex pairs. And, the Precision and Gold Digger bot focus exclusively on gold. I am certain its algorithm is specially tuned to these pairs. Yet, I don’t want to overthink it.

I own three University of Options bots. As with all bots, they need to prove themselves. None of them have paid for themselves yet. If they continue activity like this, they might make me a believer.

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Runaway Gold – The Scalper

Posted on May 6, 2024 by agruenbaum

Where the goal of the Gold Digger is to make about 100 X the lot size (a lot size of 1.0 should yield approximately $100 when closed.), the Precision bot has not entirely revealed its inner workings. Yes, it is entering into trades to make money. It knows it won’t make money on every trade. Its goal when the T/P is hit is to grow the account size. The specifics are what I am trying to understand.

The Precision has taken dozens of trades on gold. The price of these gold trades ranges from $2323.48 – $2296.62. Based on its present trades, it has determined it will make the desired profit when the T/P reaches $2308.93. When that price is hit, all trades will close. The profits, losses, commissions, and swap fees are calculated when setting the T/P at $2308.93.

I don’t know when Precision will close these trades. I know that is its goal. Based on its settings, its only goal is to close the open trades. It will stay out of mischief until our dinner time tonight. Then, during what I hope is a less volatile time, it will find gold more cooperative to its trading style.

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Runaway Gold

Posted on May 6, 2024 by agruenbaum

After the market opened Sunday afternoon (I am in the Central Time Zone), I was glad to see my bot snap up and quickly close a gold trade. Then, it took on an additional trade. This is when I got that feeling in the pit of my stomach. Did I let “gold greed” get the best of me again?

During a call NURP had last week, they had some advice on gold settings when using Gold Digger. In my Gold Digger account, I am also running The Fed. When this setup takes place, the following recommendations are made:

  1. The less volatile Forex pairs can be at their regular recommended lot settings.
  2. On the more volatile pairs, it is recommended they be at half of the “normal” lot settings.
  3. Gold should be approximately 60% of the settings it would be at if it were in a solo account. (i.e. If the account size were $100,000, the conservative lot size would be 1.0. If Gold Digger runs with The Fed, the lot size should be closer to 0.6)

Because gold is heightenedly volatile, the NURP leadership recommended lowering the lot sizes to closer to 40% when operating the 2 bots together. So, when the second gold buy took place and rapidly went the wrong way, I started beating myself up. Why didn’t I listen? Yes, I am using a risky vehicle to generate predictable income. But, I must either stop checking on my bots or make the lot setting match my tolerance for the turbulence of the market.

Gold Digger t is already working on the solution. It has dropped another trade. When the price hits $2318.61, the trades will close…unless it drops another trade and raises the T/P price above $2318.61.
I am optimistic that Gold Digger will close these trades by noon. If not, it will place another trade when it deems it appropriate.
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Is The Broker Broken?

Posted on May 4, 2024 by agruenbaum

To avoid any confusion, this has nothing to do with the brokers being untrustworthy. As far as I know all money is safe. The issue revolves around the communication between the bots and the brokers. If the communication between the bot and broker is not consistent, trades might look like this:

On the first 2 entires, the “T/P” is 0.000.

Within the NURP community, they are attributing this to the latency (delay) of the broker’s servers. And, in the case of many US traders doing algo trading, this is at Ox Securities. The trade is placed, but not all parameters are correctly communicated. The no “T/P” is the only parameter I know is sometimes dropped when a trade is completed.

The solution?

  1. You can close the trade as soon as you notice it–ideally the trade will be in profit.
  2. You can see if the bot has further communication in a day or two with the broker’s servers and updates the field.
  3. You can always close the trade from within MT4 at any time. You don’t have to make a decision now. 😉

If everything all worked perfectly, it would be too close to heaven. And, in heaven, we won’t need money. 🙂

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Solo Bot Math

Posted on May 3, 2024 by agruenbaum

The Pro FX bot was part of the University of Options 3-bot purchase. These bots may not give me double-digit monthly gains, but they are reliable. This relative of the Precision scalping bot hasn’t had much attention, so I wanted to let it know I do appreciate it.

In nearly a month of effort, this bot has done over $400. Today, it did $311 on an account with just under $20,000.

What if we give this humble bot a year of trust? What might it do? I realize this is only a month’s worth of effort, but we have to start somewhere. (Pro Fx lives in the account previously inhabited by Gold Digger. This relocation took place in early April. April gains were split between the two bots.)

Expenses

  1. Since I bundled this bot with 2 other bots, my purchase cost was just over $3,000/bot.
  2. Every month, I must pay for a Virtual Private Server (VPS). This is approximately $35.99 or less.
  3. There are NO ongoing monthly costs. This bot has no monthly cost–EVER!

Assumptions

  1. Our account has $20,000. That is what the bot is working with.
  2. The bot continues to make 2%/month. I don’t want anyone to think I am cheating, so I will say the bot makes 1.9%/month. (This will account for the cost of the VPS without adding too many variables.)
  3. Using these assumptions and this Forex calculator , we get this result:

Summary

Initial deposit:$20,000.00
Percentage:1.9% monthly
Effective Rate: 25.34%

Time:1 year
Compounding:Monthly

MonthEarningsAccrued
Earnings		Balance
0––$20,000.00
1$380.00$380.00$20,380.00
2$387.22$767.22$20,767.22
3$394.58$1,161.80$21,161.80
4$402.07$1,563.87$21,563.87
5$409.71$1,973.58$21,973.58
6$417.50$2,391.08$22,391.08
7$425.43$2,816.51$22,816.51
8$433.51$3,250.03$23,250.03
9$441.75$3,691.78$23,691.78
10$450.14$4,141.92$24,141.92
11$458.70$4,600.62$24,600.62
12$467.41$5,068.03$25,068.03

Is my logic bullet-proof? Absolutely not. It is a reminder that “1.9%” compounded over a year exceeds 25%. And, if you owned 3 bots that each had $20,000 they managed on conservative settings, what could that look like when 12 months have passed? I like how you think!!

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Risk Cubed

Posted on May 3, 2024 by agruenbaum

As is clear, I sometimes berate myself for getting greedy. I choose excessive lot sizes or I choose to stalk bots that can’t handle the pressure. Or, before I made even those decisions, I decided to invest in the foreign exchange market. My financial planner has let me know he won’t be recommending this to any of his clients no matter how successful it is for me. So, what could be the point of this post?

NURP has a portal for those who operate their bots. (i.e. Gold Digger and The Fed) Within this community, the various users talk about successes and failures. One user made a 40% return using The Fed last month. He didn’t make this on conservative settings! What did I make? I made over 8% using the recommended settings. Some users talk about 4X-ing the recommended lot sizes. With my recent leap into gold scalping, I know how 2X-ing the recommended lot sizes can nearly blow up your account. Slow and sure-ish sounds more appealing than a determination to be first to the finish line despite the financial danger.

Don’t get me wrong. I love the idea of my account rocketing to consistent double digit monthly returns. But, it isn’t realistic. Even with the settings I do have, I know the monthly returns will vary. That is why I “bought the farm”. To get predictability and sustainability, I need to make a commitment to boring. When I receive the email from NURP on Monday morning about expected risk this week, I am not the guy who thinks, “NURP says get greedy.” I am the guy who says, “The farm is doing best when it falls within a predictable range.”

Over the coming months, I am likely to add some additional NURP bots or those from other bot suppliers. What you won’t be seeing is me trying to prove my financial genius on the farm. Is it possible to be successful and conservative in a risky environment? I an committed to trying!

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Is It Worth Running A Bot Farm?

Posted on May 2, 2024 by agruenbaum

Some days, it absolutely is not worth it. In April, I wanted to sell the farm and trade in all of my “tractors” for push mowers. Mowing the neighbor’s yard was going to be a more reliable source of income than the bot that developed amnesia if you hurt its feelings. I was ready to be done with it until I remembered this money is not for tomorrow, it is for 5 years from now. Once I allowed that perspective to permeate my thoughts, the list of negatives issues shrunk. What were they?

Wouldn’t it be easier to learn how to trade and make your “big” trades a couple of times per month? That way, you can relax and not worry what is going on in the market the rest of the time. At my age, I would get cranky if I had to alter my priorities to learn something I am not sure I would enjoy and be good at. Learning is good; my patience with unfamiliar concepts is not good.

Can’t you just set the bots up and leave them alone? Why do you need to stalk your bots constantly? I am a optimistic-pessimist. A “trust but verify” type of guy. I am aware of things that can go wrong. The “fix-it” part of me wants to take care of any problems as quickly as possible. I would be thinking about worst case scenarios whatever I was doing.

Maybe if you didn’t have this blog you wouldn’t be forced to think about what is wrong on the bot farm. This is a very valid point. What am I going to do for a topic today? What negative (or positive) thing can I point the magnifying glass at? If I just lived life and didn’t think of what might be insightful for others, I wouldn’t think of what was financially painful (rewarding) for me. If the post doesn’t seem sincere and written by a human, I don’t find it very interesting either.

Why try to give people a shortcut to start their own bot farm? Despite what my kids jokingly say, I do like helping people. I am convinced there is value in the bot farm concept. If I can give people a shortcut to success or enhance their chances of finding success more quickly, then I will sleep better knowing I tried.

    If nothing else, any blog readers will know more about algorithmic trading than the average. Ideally, my description of the pros and cons will allow for a productive conversation if the topic ever comes up. Good Luck!

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