The algo trading bot is still working on making the USDCHF trade profitable. Yesterday, the bot was involved in several losing trades with this trade. Today, it has added another trade that has started out as a loser, too. (Lot size of 2.16)

EFX, the provider of the bot, claims running the bot on the “aggressive” setting will typically see a 10% or more drawdown. Within the community at EFX (If I haven’t mentioned this, the community is a very helpful resource when getting started with your bots. I will have to do a future post on this.), many people have been concerned about the amount of their money that is in limbo until the trades have closed.

EFX continues to post reminders that read similar to this:

I understand your concern about the recent drawdown, but it’s important to remember that this aggressive risk profile was chosen for a reason. Our expected drawdown average is over 10%, so despite the recent increase, we’re still within acceptable limits.

While stop losses are a common risk management tool, they aren’t always effective with automated trading and can sometimes cause more harm than good. However, we do have circuit breakers in place, which is why you may have noticed other algorithms slowing down their execution of new trades. Our algorithms are designed to work together and hedge positions, providing an additional layer of risk mitigation.

As a team with years of experience in automated trading, we have run and optimized these strategies extensively. It’s natural to feel the urge to micromanage when faced with fluctuations, but it’s crucial to maintain a long-term perspective. Our track record spans over two years and has weathered countless scenarios similar to this one.

Rest assured that our team is closely monitoring the bot’s actions and is well-aware of its behavior. Investing inherently involves ups and downs, but what matters most is our long-term performance. We remain confident in our strategies and encourage you to trust in the process.

This bot like every other algorithmic trading bot is not perfect. Some market situations may cause it to struggle where other bots would have no problem at all…and visa versa. The important thing is to have a trading bot that knows how to dig itself of any holes it falls into. I continue to trust this will all work out. Of course, I will keep those who visit this blog updated. 🙂