Myfxbook AutoTrade Review (Our Opinion)
AutoTrade is the automated social trade copying service of Myfxbook, the trading community portal. This review is only focussing on AutoTrade and not the Myfxbook website in general. As with our other social trading network reviews, this one is also based on experience with a live real money account. Click here to jump straight to the review summary below.
Signing up to AutoTrade?
Unlike some other social trading platforms like eToro and Ayondo, Myfxbook doesn’t act as a broker itself. Hence to sign up for the AutoTrade service you need to register with one of their partner brokers. There’s currently a choice of about 40 brokers to chose from so you’ll likely find one in your region and one which meets your requirements.
Please note though that if you’re already a customer of one of those brokers, you cannot use your existing account to connect to AutoTrade. I.e. you need to sign up again via the Myfxbook website. This is because Myfxbook wants to receive the broker commission for introducing you. Other autotrading services which use 3rd party brokers normally have the same requirements, because this is the way they pay for running the platform. Unfortunately this also means you cannot benefit from the new account bonus offers some brokers offer, since those are normally only available when you sign up direct.
The Myfxbook website has a useful table comparing all the live spreads between 100′s of brokers, which you can use to help you chose, as well as many broker reviews by customers. However there’s no option to filter though the AutoTrade partner broker list. I.e. it would be useful if you could only show brokers based in your country (e.g. UK). Most brokers also charge a small extra commission per trade for using AutoTrade, though you’d need to contact each one separately to ask how much, since that info is not available on Myfxbook.
Once you’ve signed up with a broker you have to link your account to AutoTrade, which involves entering some additional info on the Myfxbook website and e-mail a signed copy of the “Letter of Direction”. Unfortunately the letter provided by Myfxbook seemed to be the wrong one for our broker (FXCM) and we had to sign another one which awards myfxbook 1 pip per trade commission. Overall the sign up and account linkage process took 2 weeks, which is a bit slow.
You’re also free to chose an account in your currency of preference. I.e. you don’t need to open your account in the same currency as the system(s) you want to subscribe to, though obviously if they trade one $ dollar lot, and you have a £ sterling account, one £ lot will be traded in your account if you copy at the same ratio.
What are the systems you can copy?
There’s a choice of about 40 to 50 systems for you to review, analyse and subscribe too. All the systems need to meet the following Myfxbook requirements in order to get and stay listed:
- trade from a real money and verified MetaTrader 4 account which is connected to Myfxbook and has at least 3 months trading history and 100 previous trades
- the minimum account balance is $1,000
- historical drawdown has to be lower than 50%.
- historical return on the account needs to be higher than 10% and higher than the maximum drawdown
- average pip win per trade to be at least 10 pips
- average trade time more than 5 minutes
Myfxbook also doesn’t allow systems that use any type of martingale/grid techniques (i.e. risky strategies which add to losing positions). The minimum pip win and average trade time requirements are clearly added to avoid scalping systems. Because of slippage these do not work well on copy trading platforms.
Traders also get paid 0.5 pips per winning trade by Myfxbook on all investors subscribe to their system.
Overall though these AutoTrade system requirements and reward structure seem sound. However, we’ve noticed systems listed with historical average returns of much less than 10 pips per trade and which clearly describe themselves as a scalping system. Hence it doesn’t look like Myfxbook if very rigorous in applying these constraints.
I’ve also not subscribed long enough with my real money account to make a solid opinion on the performance of the current systems, but as with all our reviews I’ll update when more data is available.
One point worth noting though is that when AutoTrade initially started I tried the service with their demo account. After following it for a bit I didn’t look at it for over a year and when I returned all systems I was following had gone. This is however not a massive surprise, especially since the service was still very new at the time and the requirements may have not been as strict.
However, past performance is never a guarantee of future returns (we all know that), so systems can certainly have a bad run and get removed. The image on the right shows all the live systems on July 2nd 2015 so it easy for you to compare that image with the current systems at the time your reading this review to check how many have gone or got added.
We also recently noticed that one of their most popular systems HANSTREND was removed from AutoTrade on 30th June 2015 and the system can now only be copied via Signal Start.
Analysing and Selecting the Systems to Copy
Here we review the features Myfxbook offers to compare and analyse the systems you might want to subscribe to and copy. In terms of finding the systems, with about 40 available, AutoTrade displays them all in one list (see image above). By default all systems are ordered by the proprietary Myfxbook rank, which ranks highest the systems that have gained the most with the lowest risk, while having the most consistent growth curve.
Instead of rank, you can also order the systems by name, lifetime gain, average daily gain, monthly gain, maximum drawdown, system type (technical/fundamental), trading type (automated/manual/mixed) and number of subscribers. AutoTrade also shows a small performance graph next to each trader in the list. I think this is very useful to get a quick impression of the consistency of the trading system over time (i.e. you want a gradual incremental graph).
Once you find a system you like in the table, you can drill down to get the description and detailed stats (see image on the right). And “detailed” is a very appropriate word here because AutoTrade shows all the basic stats such as breakdown of performance and drawdown over various time intervals, best/worst trade, avreage trade duration, etc. …. but also a range of more advanced one. This includes indicators like profit factor, standard deviation, sharpe ratio, Z-Score, expectancy, AHPR, GHPR and several other. Don’t worry , some of them I hadn’t heard off myself, but most of them have contextual help with a short description.
You’ll also find a good selection of graphs on AutoTrade which can assist you with analysing the systems. And something we find very useful is that Myfxbook lets you export all historical trades in csv format, so you can analyse it yourself if you like.
One important caveat to note though is that quite a few popular systems make their stats private on Myfxbook. Unfortunately some of the hidden stats like “current open trades” and “account balance” are quite useful and important to know in my opinion. You also cannot export their trade history or view their historical trade sizes. Hence it really depends on the system whether the stats provided are useful or not.
So overall, while there’s no advanced search functionality to filter the systems, with the amount of them available the list view should be sufficient for most investors to get an impression of which systems they want to have a closer look at. In terms of detailed stats Myfxbook probably offers the largest selection of financial indicators and statistics compared to any other social trading network or autotrading platform. The fact that quite a few important stats are hidden for some systems on AutoTrade is the one significant negative point (depending of the system you’re looking at of course).
AutoTrade risk and money management features
Here we discuss what features Myfxbook has available to allow you to manage your risk when you start copying one or more systems on AutoTrade.
Once you want to copy a system, you can specify:
- the multiplier to copy the system (1 to 1, more or less)
- max allowed number of total lots of open trades and orders copied by the system
- max allowed open trades and orders copied by the system (although it’s a bit strange that one of the missing stats for each system is their historical max number of open trades)
- $ balance stop level at which you point you stop copying the system
(please note that if your account is in £ pound sterling this refers to the pound sterling value)
- floating drawdown (%) level at which you stop copying
- fixed lot level if you want to copy every signal in the same size
- any symbols you don’t want to trade
- specify the hours and days you allow trading
The first issue we noticed was that within the detailed AutoTrade risk limitation settings, the interface showed 3 descriptions but 5 entry fields (both on Firefox and Chrome browsers). A bit confusing, but the issue seems intermittent.
The multiplier is obviously useful though always consider that when you reduce it to less than 1 your results will definitely differ from the system because your lots will be copied to the nearest round lot size with a minimum of 0.01.
In terms of the other AutoTrade risk features, the main issue we found is that you cannot allocate a specific amount or % of your account balance to a certain system. Hence 1 rogue trader can deplete your full account, or up to the balance stop. But since the balance is impacted by all systems you copy at the same time, it makes no sense to set it too close on an individual level.
When you start copying a system, Myfxbook will by default copy all open trades when they can be opened at a price better than the system. This basically means though that all trades in losing positions will straight away be copied. Not something we normally like to do, but there’s no option to only start copying new trades. Hence to avoid this you need to wait for the system to have no open trades before you start copying (not an option with some of the longer term strategy systems).
You can also use the simulator to test different AutoTrade setups. I.e. you select the systems you consider copying and the account balance you consider using and the system will show your “hypothetical” results over time (assuming you copy the system 1 to 1). I.e. the simulator is pretty basic since it doesn’t allow you to enter different ratio or trading settings. In addition, it’s very important to note that the “real-live” results you will achieve are almost always vastly worse than the “hypothetical” ones. This is because the performance results for the systems on Myfxbook do not take into account fees, spreads and/or trading commissions charged by your broker and neither do they account for the inevitable slippage.
In terms of risk it’s also worth reading through the terms Myfxbook requires you to accept when you start copying a system. Their refund policy in case you make losses in your account in case a copied trade was not closed is very restrictive. I.e. you need to notify them with a refund request within 24 hours of the trade. Since people normally use autotrading so they don’t have to check their account every day, this pretty much means no chance for a refund. In addition the terms also state that if the blame lies with the broker, there’s no refund, and with Myfxbook being based in the British Virgin Islands, good luck in taking them to court.
Integrated social trading networks who act as broker as well are much better in terms of refunds, because everything is under their control (and that’s also why hardly any of these types of issues occur with them).
Once trades are opened you can view the performance using the AutoTrade online interface. You can also use the interface to close all open trades from a system (in case you want to intervene or take profits), though you cannot close individual trades. You have to do this using your own broker’s trading platform.
So overall the AutoTrade risk management features are very basic. They are ok for when you want to copy a single system, but they have severe limitations once you start copying multiple systems at the same time (something Myfxbook actually recommends in the AutoTrade help section in order to diversify and spread risk) .
Costs and fees
While you don’t have to pay anything direct to Myfxbook for using AutoTrade, most brokers will add a commission to each trade executed in your account from an AutoTrade system signal. In our case 1 pip per trade with FXCM, and we’re not aware of any broker which doesn’t add a commission. If anyone knows one feel free to let us know?
As we mentioned above, there’s unfortunately no table with this information available for each partner broker. A bit strange since Myfxbook does manage to show the live real-time spreads, quotes, swaps, volumes and offers of 100′s of brokers, all of which would be more difficult to maintain than a simple table with the AutoTrade commission fees charged by their partner brokers.
In addition, you have to take into account the slippage/divergence as a cost too. I.e. this is the difference in price between what you got charged at your broker and what the system provider got. While the slippage can be to your advantage, due to the nature of copy trading, it normally isn’t. And also with AutoTrade the slippage is evident. It will vary per system though and is impacted by various factors, including popularity of the system, location of the system’s broker compared to your broker, system’s trading style and trading hours. In our experience the slippage will always be a higher with platforms like Myfxbook, which act as the hub connecting the investors and system providers’ brokers, compared to trade copying services which act as broker as well (i.e. where everyone’s connected on the same broker).
Myfxbook only offers a contact form to get in touch with support. I.e. no telephone number!
When we requested some further explanation on one of the indicators using the contact form they did respond within 60 hours.
On the other hand the Myfxbook website hosts a very active trading community forum for novice and experienced traders. Their site also provides market news, real time charts and an economic calendar. The actual AutoTrade FAQs and help pages are useful but very basic.
While one of the forums is set up to discuss and rate trading systems, there don’t seem to be threads for the systems offered on AutoTrade. I seem to remember that a few years ago there was a direct link from the stats to the system reviews within the AutoTrade interface, though that’s no longer the case.
Myfxbook offers a free demo account for anyone wanting to try the AutoTrade platform. It allows you to try all the features with virtual money and unlike some other social trading networks demo accounts there’s no time limit. Please note though that the demo account uses the “hypothetical” results, so results in a live account will be worse.
Myfxbook AutoTrade review Pros:
- Every system and trader you copy risks their own money
- Decent choice of partner brokers
- All systems verified and monitored to meet requirements
- Wide choice of stats and graphs (if not hidden by the system)
- System’s historical trade data can be downloaded for own analysis (if not made private by the system)
- Full non-expiring demo account available
- Trader/system rewards linked to performance (paid for winning trades only)
- Trades can be copied proportionally
Myfxbook AutoTrade review Cons:
- Not all data is shared by every system you can copy
- Partner broker costs/commissions per trade not transparent
- Use of “hypothetical” results & stats can give wrong expectations
- Risk cannot be limited per system on individual basis (account level only)
- Already open systems trades are copied by default (no option to disable)
- Some interface glitches and errors experienced
- Slippage means your results will be slightly worse than the systems you copy
- No AutoTrade system reviews or ratings by other investors
- Refund policy is very restricting
- No telephone or online chat support
- Based in British Virgin Islands
In summary, the amount of information and stats provided by Myfxbook on the systems which have linked their account is great (for the systems which don’t hide some info). The parameters used to select and monitor the systems offered for subscription to customers via AutoTrade seem sound as well. However the risk management features of the platform are limited and only useful if you copy one system at a time. And while Myfxbook is clear about this in the fine print, the fact that “hypothetical” results are used for the stats, simulation and demo mean the expectations will be wrong since actual results will be worse. The extra broker commissions, high slippage and draconic refund policy further dampen those expectations.
We’ll keep this AutoTrade review updated when new features are introduced by Myfxbook or if our view changes (based on using the service). Your own comments and experiences are always welcome below too?
Last updated: January 26, 2016
This review is written based on our experience with a real money registered and linked account. Please also note that FX and social trading can be very risky and involves the risk of losing your investment. Hence this may not be suitable for you so always consult an independent financial advisor if you’re not sure whether this type of investing is for you. And never invest money you cannot afford to lose.