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Why Win Rate is not the best metric


The win rate on forex trading is no doubt one of the most observed aspects when traders come into the forex exchange world. Thus, questions like “what is your win rate” or “what is your risk ratio”, are very frequently made when a forex signal provider has been assessed. However, do you know that Win Rate is not always the best parameter to evaluate performance?

We hope to help you invest in forex efficiently and improve your results. You can also get extra forex trading insights from leading finance experts on our trading Academy and on our free forex Telegram channel.

What you can learn in this article

  • Understanding the win rate in forex trading
  • Is there a perfect win rate?
  • How to improve my trading performance
  • How to trade forex with AI

So, let me explain it better with some concepts and practical examples.

Survivorship Bias

Have you ever heard this term? This is a well-known phrase from the analysis of mutual funds. Especially in the hedge fund industry, this is a common problem.

What it means is that that there is a tendency to watch only the performance of “survivors”. This is the so-called “survivorship bias”.

For example, hedge funds make risky investments. Some of these funds make huge losses. The result is that investors sell their shares and the fund will be closed eventually.

If such a fund is liquidated within three years, it will not appear in the performance analysis of hedge funds over a period of five years. Thus, the performance for hedge funds appears to be better than it actually is.

 

Forex Trading

And the same happens when copying other traders. For example, the eToro forex broker has hundreds of thousands of customers. All their results are evaluated.

And even if none of those traders has any idea of ​​Forex trading, a certain percentage of them will succeed – just out of pure chance. Such traders will appear in the leader-boards of eToro and will be copied diligently.

Other traders may not know whether such persons have been successful because of their experience, their sharp analytical skills or their instinct, or whether they were just lucky.

What matters is the final result

It is quite obvious that you trade to make real money, not ratios. Therefore, the investor needs to note that in reality, Win Rate is just a metric, but it does not always mean extra money from forex trading.

Let me give you an example of why a win rate in forex or other markets, such as Stocks, CFDs, Commodities, Cryptos, or Futures, is not the best parameter for choosing a trading signal provider.

Think about a track record of 100 trades in which 99 trades are Wins and just 1 is a Loss. So, you have a 99% win rate. But, it is possible that this only 1 trade-in loss can be enough to make the other 99 trades not profitable.

 

Forex Trading

How is it possible? Basically, if you have 99 wins making $1 each, you will have $99. On the other side, that 1 loss can be $100. In doing so, the Win Rate would be 99%, but the final result would be unfeasible (negative).

Does it worth it? Absolutely no, but this is how most of the forex signals providers on social media have been misleading forex traders. They disclosed extraordinary win rates and risk ratios, displaying just its win trades and hiding that 1 killer loss.

You must to also be aware of forex signal providers that display that amazing performance from practice accounts. They are the typical scammers.

What to do?

  1. Focus on monetary performance. What matters is money?
  2. Check parameters such as APY (annual percentage yields) or average monthly percentage yield.
  3. Ask for live track records, but beware of frauds. Scammers usually manipulate the way they display their accounts.
  4. Search for reliable forex signals providers. They usually have a website, with detailed information about the trading strategies, the company, and the team.

Trade forex with AI.

Wiseinvest.ai is a legit business, with cutting-edge trading solutions made by a team of real and committed specialists in finance and technology. All our signals are emitted by Artificial Intelligence, nurtured by the best live-trading strategies.

Our trading strategy considers that the performance must be composed of a final result in monetary units, such as Dollars, Euro, or Pounds. For this reason, although we make results disclosures in Pips, we always highlight trades in Dollars.

We also focus on the return of 40% of APY and not just on Win Rate, to help you make money in a trustworthy way.

The best way to trade forex

There are two ways to invest with our AI in forex:

1. Automated with AI-Trading. Check out the 3 steps to trade automated with our AI.

automated trading with ai bot

By trading forex automated with AI, you will save time and improve your performance without monitoring the market and managing trading platforms.

With Automated AI trading you do not need MT4 / MT5 and other trading platforms to invest in forex. All forex trades are automatically placed into your broker account every time that our AI system identifies a new worthy trading opportunity. You can monitor the AI trading performance in real-time directly on our dashboard.

Automated AI trading benefits

  • Setup in 3 minutes.
  • Totally hands-off, from anywhere.
  • Invest from just $1.
  • Integrated with the forex best brokers.
  • APY of 40% over the past 13 years*.
  • Lightning-fast execution & no slippage.
  • No commissions, no management fees.
  • Portfolio with 40 different automatic strategies.
  • No MT4/MT5 or other platforms required.
  • Test with a risk-free practice account.
  • Trading results directly on our dashboard.
  • Trading alerts in the broker account by email and Telegram.

Would you like to open a forex broker account? Our AI is integrated to trade automated with the brokers Oanda and FXCM. Click here to open an account with FXCM or here to open with Oanda. Those are some of the best forex brokers in the world.

2. Manually with AI forex signals.

Wiseinvest also provides AI forex signals that perfectly fit into MT4, MT5, and any trading platform. To trade with our AI forex signals, you must simply copy the data you receive from each real-time signal into any forex brokerage account of your choice.

There are five unique variables for each AI signal, and each must be copied exactly, in order to match the performance of the signal as close as possible.

Each AI forex signal alert consists of the following five data points:

  • Symbol (forex pair)
  • Direction (long or short)
  • Position size (number of units or lots)
  • Take profit (price level to exit with maximum gain)
  • Stop loss (price level to exit with maximum loss)

Check out how to trade with our AI forex signals.

  1. Subscribe to a Wise-Plan.
  2. Open a Brokerage account. Check this article about the best forex Brokers.
  3. Set an amount and a position size on our Wiseinvest dashboard.
  4. Our AI will send you real-time trading alerts by email and Telegram.
  5. Copy the signals and paste into your Brokerage account.

All forex signals are sent every time that our AI trading system identifies a new trading opportunity. Our trading strategies are developed on a variety of time frames such as 4 and 8 hours.

Wiseinvest AI forex signals are Market Orders and you do not need the entry price. You can copy each signal while it is available on our dashboard. We do this way to assure that traders will just place signals while they are good to be traded.

You can trade forex with our free forex signals clicking here, or with our Premium subscription that provides you unlimited AI signals and automated AI trading in partner brokers. Whether you are a beginner or a professional forex trader, our AI trading system can help you save time and improve your trading performance. Get started with free AI.

When investing through Wiseinvest automated AI trading or AI forex signals, you do not need to calculate pips and change the leverage in your forex broker account. Learn more about leverage in forex trading clicking here.

What is the performance of the AI in forex trading?

The Win Rate of our AI varies and can reach up to 95%. Our performance is based on an efficient frontier, which means that our model is profitable whenever the Win Rate is greater than 60%. Our strategies seek stable returns and sufficient results to achieve an average return of 40% per year (APY), without the application of high leverage.

We know that what matters in forex trading is the final result. Therefore, the investor needs to note that Win Rate is not always the best metric, as other signal providers disclose. For example, out of 100 trades, only 1 trade may be enough loss to make the 99 trades not profitable. In this case, the Win Rate would be 99%, but the final result would be unfeasible (negative). Therefore, we focus on the return of 40% of APY and not just on Win Rate.

It is essential to observe that forex brokers may charge spreads, commissions, and overnight fees. These factors can affect the AI performance. You can check our forex trading track record clicking here.

How much do I need to trade forex with AI?

You can start in forex trading with free AI signals or AI trading account and deposit just $1 in the broker. You can also test using a risk-free practice account with our AI trading system. However, in order to do efficient risk management in real accounts, we suggest you start from at least $100. Notice that some forex brokers require different initial deposits to trade forex.

What is the trading strategy of our AI?

Our AI strategy is the combination of different AI trading systems, with more than 100 features, that define 40 different strategies which simultaneously consider: Quotes of the 28 forex pairs, Supports & Resistances in different time frames, Trends and Counter-trends, Cross-indicators, Index of each pair, Economic Calendar, Investors Sentiment.

Our AI analyzes those fundamental, technical, and sentiment factors that affect forex trading, and all criteria are evaluated in real-time using different weights. After completing the analysis, the choice of the signal emission strategy is made considering the increased likelihood of short-term profit and the amount available for investment.

Using technical analysis, our algorithm considers not only the patterns of various trends, including support and resistance levels and cross-indicators, but our AI is also able to create its own real-time index for each currency pair, that is used to identify what is the best direction and target.

In relation to fundamental analysis in forex, the AI makes a correlation within the economic calendar to find news data that can affect specific currency pairs.

Understanding Finance Is Critical to succeed

No matter how you decide to learn about finance, having these skills can bring success in your professional and personal life. We always recommend learning more about finance and trading.

We are committed to providing the best results and democratizing the retail forex trading market. We work hard to provide financial education, allow anyone in the world to invest easily with Automated AI trading and free AI forex signals.

Enjoy other free articles about forex trading on the trading Academy and on our free forex Telegram channel.

Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.

The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. FXCM warns that 74.74% of retail forex traders lose money trading CFDs.

The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.