The Tao Expert Advisor

[Rahn Heart]

The Tao is what I call a full reverse Martingale type expert strategy.
However, I would like to make a distinction at this point between how
a Martingale works and a different strategy that I call a Multiplier.
From the technical standpoint a Martingale increments "bets" or lot
sizes according to an exponential factor that will counter the effects
of a previous loss. This factor is related to the size of the previous
"bet". A multiplier on the other hand uses varying lot sizes according
to a "schedule" that may go up or down relative to the next order
placed. To put it more simply - a Martingale will continuously
increment larger and larger lot sizes while a Multiplier will
increment lot sizes up and down accorder to other factors like the
distance between order positions.

The Tao is kind of a Martingale Multiplier in that it doesn't adhere
to a fixed exponential lot size manipulation but the lot sizes in
general to continuosly increase in size until a batch profit is taken.
A Full Reverse Multipler or Martingale strategy will take all
positions against the trend from the first to the last. The idea is to
keep placing contra orders until the trend reverses and you close out
your orders on the profits made on the reverse side of the trend.

The Tao rarely if ever loses because it doesn't place new orders on a
strick fixed spacing between the orders. It uses a Moving Average type
of indicator to place the new orders only when there is a small trend
reversal. This means that it can sustain longer trends to the reversal
without exhausting the Max Order Limit before it gets to the top of a
trend which will usually cause most fixed spacing Martingales to
crash.

However, as with all Martingale and Multiplier Full Reverse Strategies
the initial lot sizes MUST be at a minium relative to your account
balance in order to endure the potential very long trend swing. What
this means with regard to returns, although the Expert will probably
never lose it will take a long time to make any substanical profits.

I have intiated the development of a Qx Multipler that uses a reverse
hedge which is more similar to the FAP Strong Trend Expert which is
potentially much more profitable.