HomeArticlesMegadroid Money Management – How I do it


Megadroid Money Management – How I do it — 6 Comments

  1. Thanks for your interesting site. You seem to have a very high amount of money on your broker accounts 🙂 I don´t see that you mention the risklevel setting in the Megadroid EA. Is that not important in your money management?
    I´m on my way to start with $1000 on IBFX (megadroid EA). Is that to small deposit? I was prepared to take a 10% risk in every trade. Am I correct that 100pip is $100 in money in my example? I was planning to use the EA to scale the lot size according to the balance.
    Kind regards /Linus

    • Hi Linus,

      The “risk settings” on Megadroid are a little bit arbitrary. On a 1kUSD account, with a “10% risk setting”, Megadroid would probably trade a lot size of about 15k EUR/USD. That’s $1.50 per pip.

      As I mentioned, most of the larger losses are around the 50-60 pip mark. So that would be a $75 to $90 loss or 7.5 to 9%. I guess that’s close to 10%. However I do my risk assessment based on a 120 pip loss because that has happened to me on one occasion before. So on a 1kUSD account with “10%” risk setting that would mean 120 x 1.5 = $180 or 18% loss.

      I can’t offer specific advice, but if I were planning to trade with that setup, I’d ask myself whether I was comfortable with that sort of downside risk. $180 might not be much for some people, but for others it’s a lot of money. It depends on your own financial situation I guess.

      Hope that helps

  2. Megadroid uses a variable stop loss. It runs between 50 and 150 pips. This can be seen by running a simple backtest with the Stealth Mode off. Most of Megadroids losses have been in the 50 pip range, but the larger loss is always possible. Add to that Aggressive Mode and Recovery Mode, if you use them, and this is the real risk.

    Their risk control is just a fixed percentage of the free margin and unfortunately doesnt take the stop setting into account. This leaves great varriance in the real risk, should things turn bad.

  3. You’re absolutely correct Ken.

    That “risk” setting by no means defines the maximum risk. Apparently the actual stop loss is based on the size of various candles, and elapsed trade time. I’m not across all the specifics, but it can vary a lot depending on these factors.

    We’ve also had numerous instances in the past when both the aggressive and nonaggressive trades got stopped out on the same day.

    My approach is to trade fixed lots (aggressive on recovery off), and assume a 120 pip loss is the probable worse case scenario, although it could potentially exceed that. I adjust the lot size to a level where I can deal with that sort of $ loss drawdown.

  4. Hello

    Bravo for this job.
    I started a test on Monday and I had a first position opened on Wednesday at about 23 h GMT, benefit 11.2 pips

    with TADAWULFX with a fixed spread of 2p


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