New Smarthedge EA MT4 V1.16 + Setfiles

New Smarthedge EA – Correlation Hedging Strategy for MT4

New Smarthedge EA is a correlation and cointegration hedging system for MT4 that simultaneously trades two highly correlated instruments, entering on divergence and exiting on convergence. Three backtests at 99% real-tick modeling quality across USDJPY/CADJPY, AUDCAD/NZDUSD, and EURCAD show profit factors between 1.46 and 1.69, with a public Myfxbook demo account confirming the v1.16 build runs on live broker infrastructure. No vendor-verified live account exists — the performance case rests on backtest quality and one third-party demo account.

• Vendor Website: View here

Key Highlights

• ✅ Trades two correlated instruments as a basket — entry triggered by divergence, not directional prediction
• ✅ AUTO mode selects the second instrument by correlation from Market Watch — no manual pair-matching required
• ✅ Equity profit close and trailing basket profit parameters allow account-level exit thresholds independent of individual trade results
• ✅ Max Lot caps at 10.0 per symbol; spread and gap filters block entries during abnormal conditions
• ✅ MT4 v1.16; MT5 version available on MQL5 Market as the officially documented build

Performance Results

Three backtests using 99% real-tick data on RoboForex MT4 at $1,000 / 1:500 leverage show the following across pair combinations:

• USDJPY/CADJPY: profit factor 1.50 — 571 trades — max balance drawdown 41.16% — max equity drawdown 53.20%
• AUDCAD/NZDUSD: profit factor 1.46 — 1,145 trades — max balance drawdown 51.23% — max equity drawdown 60.29%
• EURCAD: profit factor 1.69 — 542 trades — 63.5% win rate — max balance drawdown 36.04%

Recovery factors ranged from 2.24 to 2.76 across the three tests. Backtest recovery does not guarantee the same in live conditions.

A public Myfxbook demo account for New Smarthedge v1.16 on RoboForex MT4 shows +8.47% gain, 50.73% drawdown, and a profit factor of 1.59 across 8 trades — consistent in direction with the backtests but not independently verified as a vendor-owned or real-money account. View the public Myfxbook demo account.

Drawdown is the primary risk concern. The basket model means that when correlation breaks down or top-up positions stack during extended divergence, open equity can drop sharply before convergence recovers it. At drawdown levels exceeding 50%, a $1,000 account carries real margin call risk. A larger capital base, conservative lot sizing well below the 10.0 maximum, and a low-spread ECN broker are necessary to survive the drawdown periods recorded in backtests. Monitor open equity actively, not just closed balance.

Backtest results may differ from live trading due to spread variation, slippage, and execution differences. Past performance is not indicative of future results.

How It Works

Strategy: Correlation and cointegration hedging across two instruments. The EA identifies pairs with high historical correlation (300 bars at the current timeframe), measures the percentage divergence between them, and enters basket positions on both sides when divergence exceeds the Delta First open threshold. It profits from mean reversion — the instruments returning toward their historical relationship.

Entry: First positions open when divergence reaches 70% of the maximum observed delta and current correlation clears the minimum correlation threshold. Additional top-up positions open via virtual pending orders when divergence extends further, scaled by the % Delta next open parameter (default 50%).

Exit: Basket closes when combined profit meets the minimum profit threshold or when trailing profit conditions are triggered (Start Trail profit / Close trail %). Equity profit % closes all account positions when account equity growth reaches the set percentage — the vendor recommends disabling this parameter when running multiple pairs simultaneously.

Risk Control: Balance-percent lot sizing at 0.1% per symbol by default. Koeff Lot at 1.5 multiplies lot size on top-up positions. Max Lot 1 and Max Lot 2 cap exposure at 10.0 lots per symbol. RulLock engages a lock mode when maximum positions are reached and a new signal appears. Filter spread and Filter GEP block entries during abnormal spread or gap conditions.

✅ Best conditions: Stable correlation between the two instruments — low-spread ECN broker — single pair deployment when learning EA behavior.

⚠️ Caution: Correlation breakdown during major macro events can cause top-up positions to stack heavily. Running multiple pairs with Equity profit % enabled is not recommended by the vendor.

Technical Specifications

Who Should Use This EA

✅ Ideal for:

• Traders who understand basket and hedging models and accept that open equity can drop significantly before positions close
• MT4 users who want a correlation-based system with automated pair selection rather than a directional or scalping approach
• Traders running a dedicated account sized to absorb 40–50%+ drawdown without margin call

✅ Best results when:

• Pairs with genuine, stable correlation are selected — AUTO mode assists but does not guarantee correlation holds
• Deployed on a low-spread ECN broker where spread filter parameters can function as designed
• Started on a single pair with demo testing for a minimum of 90 days before live deployment

This EA is not suited to traders who require low drawdown, plan to run it on a small account at tight margin, or are unfamiliar with hedging basket behavior.

Download Package Included

• ✅ Experts:
  • New Smarthedge EA v1.16
• ✅ Presets:
  • SET OPT NEW SH.set

Product download link is sent immediately via email after purchase.