GUIDE · RISK & SAFETY
Martingale & grid bots explained: how they blow accounts
Grid and martingale robots produce the smoothest equity curves in trading, right up to the day they lose everything. Here's how they work, the maths that makes them fail, and how to spot one before you buy.
What martingale means
A martingale bot increases the lot size after a loss, usually doubling it, so that one win recovers all previous losses plus a small profit. Most of the time it works, which is why the equity curve looks so smooth.
The problem is the losing streak. Every strategy has one. Our own Breakout EA had 12 losses in a row in its 2022–2026 backtest while still being profitable overall at a fixed lot size.
The maths of doubling
Start at 0.01 lot with a $20 stop and double after every loss:
| Losses in a row | Next lot size | Total lost so far |
|---|---|---|
| 3 | 0.08 | $140 |
| 6 | 0.64 | $1,260 |
| 9 | 5.12 | $10,220 |
| 12 | 40.96 | $81,900 |
The same 12-loss streak cost our fixed-lot Breakout EA $287 in testing. Under martingale it would wipe out almost any retail account under martingale. Recovering it would need a 40.96-lot trade.
What a grid bot does
A grid bot opens a new position every few dollars as price moves against it, without a stop loss, hoping price comes back. With a $5 grid at 0.01 lot each, a $100 move against it leaves 20 open positions and about $1,050 of floating loss, which keeps growing while the trend continues.
Gold regularly moves $100 or more in a day or two. When it doesn't come back, the broker closes everything at the worst point.
How to spot one before you buy
- Inputs called lot multiplier, grid step, max orders, recovery or averaging
- No stop loss, or a "hidden" or "virtual" stop
- Win rates above 90% with very small average wins
- In the backtest report: the equity line dips far below the balance line, because losses are open, not closed
- A smooth curve that ends in a sudden vertical drop, or a backtest that conveniently stops before one
What we do instead
Both GoldPulse bots use a fixed lot size, a stop on every trade and at most one open position. Losing streaks still happen, but each loss is the same small size. Use the free lot size calculator to see what a streak would cost at your settings.