How to Optimize the Settings

MT5 trading platform is very powerful and much better - form my experience - than MT4 for the following reasons:

  1. Latency between VPS using MT5 and your Broker is 2 - 3 times faster than the same configurations when using MT4.
  2. MT5 downloads the past history of any pairs when running a backtest or optimizing the settings unlike MT4, you have to download the history by yourself and that is never accurate. You always have to use a third party service.
  3. The quality score in MT4 backtest results with the default history is always below 90% which is inaccurate and unreliable.
  4. MT5 is faster when backtesting and also faster when optimizing the settings with the power of Agents. Cloud agents are other computers connected to the MT5 platform through where they power the opimization process and make it much faster to find the best settings.
  5. MT5 is optimized for speed and improved overall user experience.
  6. The MT5 moible app is faster and looks better than MT4 with auto light and dark modes.
  7. The most important thing is that MT5 allows you to trade stocks!

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Now, we know that MT5 is the wins this battle so, it’s time to understand the best practices to optimize the settings of the Investment Castle EA and find the parameters for the most profitable and lowest drawdown for each pairs.

This exercise is lengthy, not easy but it is worth every minute you spend on it.

Let’s get started. Go to the Strategy Tester in MT5 platform and choose the following:

  • Expert: Investment Castle EA
  • Date: Last year
  • Delays: This depends on the latency between your VPS and your Broker, in my case it is 1.8 ms so I put 2 ms as the latency increases due to the market volatility.
  • Deposit: Put non logical deposit there say 1 Million just to dictate the Drawdown dates.
  • Modelling: 1 minute OHLC is very similar to “Every tick by real ticks” but faster.
  • Optimization: Keep it on Disabled for now.
  • Disable the Visual mode for now.

Click on Start button at the far bottom right of the screen then click on Graph tab.

I’ve highlighted the importance of mitigating the risk when trading during the new in this post. Now, Let’s continue with the optimizaiton process.

This market is driven by data and news. Always remember.

So, on 11 June 2020 there were some high impact news and that’s where the EA has blown the account with 100,000 USD deposit “aggressive settings” though.

To optimize the EA, we need to activate the news option as detailed here. But keep in mind that you cannot backtest the news option. This will only work with forward testing or real trading.

Learn how to make money when you are sleeping or enjoying a drink on the beach.

Go back to the Settings tab in the Strategy Tester and activate the Visual mode and watch the chart and how the EA reacts with the market. Adjust the settings and re-run it again in-between the medium and high impact news of the same pairs.

Your goal is a low drawdown then profit comes next.

I aim to share all my knowledge and experience in trading forex to help myself make money and help others too. All the best