The Truth About Numpin-Martin EA: Risks & Long-Term Reality

1. Introduction

Many of you may have heard the term “Nippon Martin” in the FX and automated trading world. This logic is always a point of contention in the FX automated trading (EA) field, and on the internet, negative voices such as “dangerous” and “will collapse” circulate, as well as positive opinions like “stable operation is possible” and “there are EAs that actually win.”

As an EA developer who has been involved in the FX automated trading world for many years, I have actually built my own EA using the Nippon Martin logic, and repeatedly performed backtests and validations. From the standpoint of “having built it myself and deeply understanding its background,” this article explains the essence and reality of the Nippon Martin EA.

Why does this logic spark controversy? Why is it said to “always collapse” in some places, while there are EAs that have been operating for years? Additionally, we will delve into the reality of the EA sales business, the problems of IB business, and the existence of users who treat it more like a game than an investment, from multiple perspectives.

We aim for readers to be able to discern the fundamental risks and opportunities, and to make their own judgments with confidence, rather than relying on rumors or superficial evaluations.
First, we will explain the basic workings of the Nippon Martin EA in order.

2. The Mechanism of the Numpin-Martingale EA and General Risk Awareness

The Numpin-Martingale EA refers to an automated trading program (EA) primarily designed by combining two methods: “Numpin” and “Martingale.” First, let’s briefly explain the basic mechanisms of each method.

Numpin is a strategy that adds trade volume when a position moves against you, thereby lowering the average acquisition price. For example, after a buy entry, if the market falls, you place additional buy orders to reduce the average purchase price, and aim to close all positions at once when the market has recovered to a certain extent, securing profit.

On the other hand, Martingale is a money‑management technique that incorporates the idea of doubling the bet (lot) if you lose. By combining it with Numpin, you can take a more aggressive risk, increasing trade volume when the market moves further against you.

The Numpin‑Martingale EA, which combines these two, can accumulate profits with relatively high probability under the assumption that the market will eventually reverse somewhere. As a result, in backtests and early operation it often shows seemingly very attractive results such as “profits steadily increasing” and “high win rate.”

However, at the same time, there is a strong perception that the risk of collapse is high. The main reason is that if a large market fluctuation beyond expectations occurs somewhere (for example, a large trend or a sudden economic event), the additional positions can snowball, risking the loss of most or all of the capital at once.
Also, because the design is “double until you win,” if you don’t have sufficient capital, you cannot endure and will inevitably collapse.

If you use the Numpin‑Martingale EA based only on promotional slogans such as “earn easily in a short period” without understanding its mechanism and risks, you are likely to suffer large losses in the end.
This risk perception is also a main reason why a negative image of the Numpin‑Martingale EA has spread.

After this, we will delve into why such a negative impression has taken hold, and the underlying IB business and industry realities.

3. IB Business’s “Slash-and-Burn” Operations and Their Impact on the Entire Industry

In the FX industry, especially in the realm of automated trading EAs, a system known as “IB (Introducing Broker) business” is widely prevalent. An IB refers to a business model where new clients are introduced to securities firms or FX brokers, earning referral fees (rebates) based on the trading volume or number of account openings.

While this system is widely used worldwide, conducting IB business within Japan requires formal notifications and registrations under laws such as the Financial Instruments and Exchange Act. Operating an IB business without proper registration poses a high risk of violating Japanese law and may be deemed illegal.

On the other hand, it is often the case that individuals freely choose and use overseas FX brokers, and the mere use itself may fall outside Japanese regulation. However, recruiting or attracting others as an IB within Japan and earning compensation is subject to very strict legal restrictions, and many such cases are effectively illegal, so caution is essential.

Some players in this IB business prioritize short-term profits and operate in a “slash-and-burn” manner that disregards client risk and capital management. These operators may hype excessive trading or high-risk EAs solely for their own rebate income, adopting an irresponsible stance that customers can lose money in a short period. As a result, the industry’s overall image deteriorates and even healthy users become victims.

Of course, not all IBs or sellers exhibit this slash-and-burn attitude. There are IBs and operators that prioritize long-term trust relationships. However, unfortunately, the prominence of “players who disregard client losses for short-term profit” has undeniably contributed to a negative perception of dollar-cost averaging martingale EAs and the EA business as a whole.

Additionally, online casinos, which have recently gained attention alongside FX, carry even clearer legal risks. Using online casinos falls under gambling offenses and habitual gambling offenses under Japanese criminal law, and is strictly punishable.
Article 185 of the Penal Code states that a person who gambles shall be punished with a fine or penalty not exceeding 500,000 yen, and Article 186 further specifies that a habitual gambler shall be sentenced to imprisonment of up to three years.
Therefore, using online casinos or engaging in related businesses should be absolutely avoided, and they must be considered separately from FX and EA.

Thus, the reality of dollar-cost averaging martingale EAs and IB business is complex, with legal aspects and business ethics closely intertwined. Users and developers alike must fully understand this background before getting involved.

4. The Reality of Domestic EA Sales Sites and the Existence of “Long‑Term Stable EAs”

When discussing the Numpin‑Martin EA, many negative opinions such as “they all go bankrupt quickly” are common. However, in reality, even on domestic EA sales sites in Japan, there are Numpin‑Martin EAs that have continued to operate without bankruptcy for several years.

Of course, these “long‑term stable” EAs are exceptional, and many Numpin‑Martin EAs experience significant drawdowns or bankruptcies at least once during their operation due to sudden market changes or excessive lot increases. Even so, the definitive assessment that “they will definitely go bankrupt” does not always align with the reality on the ground.

I have studied and tested various EAs and strategies both domestically and internationally, and I have confirmed that among Numpin‑Martin EAs there are ones that are designed to avoid extreme high leverage and reckless lot settings, focusing on risk management.
In fact, among the EAs I have backtested and simulated, there are ones that have continued to generate relatively stable profits for several years without experiencing major bankruptcies.

On the other hand, I will be candid about my relationship with domestic EA sales sites. I currently do not have an active relationship with any specific sales site, so I refrain from introducing specific EAs or services here. However, based on the insights and real‑world examples I have gathered, I believe that conveying that “the existence of long‑term stable EAs is also a fact” is the correct way to share information.

In this way, it is important to calmly recognize that not all Numpin‑Martin EAs carry only bankruptcy risk; with thoughtful design and operation, long‑term stability can also be pursued.

5. The Participant Base with a “Game‑Like” Mindset and Why It’s Hard to Deny

In the world of Numpin‑Martin EAs, there are many participants who use them more as a “game‑like” experience rather than for investment or asset management.
This group originally runs the EA with a lighthearted mindset of “if you make a big profit, it’s lucky” or “even if you fail, I’m satisfied,” and many cases do not prioritize strict risk management as a capital‑management strategy or long‑term stability.

Like pachinko and casinos, users who run the EA in pursuit of “excitement” or “the thrill of a sudden turnaround” participate under the self‑responsibility of “it’s okay if it collapses” or “it’s purely entertainment.” Therefore, even if they incur losses with a Numpin‑Martin EA, they often accept it with the mindset that it’s a path they chose themselves, and it can be said that it is fundamentally off‑base for a third party to unilaterally criticize or deny it.

In fact, I have observed various users and sellers, and I have not found any ethical or business reasons to strongly deny the group that uses the EA as an extension of play with the risk known from the start.
Rather, those who use it in a “if I win big, it’s lucky; if I lose, I’m satisfied” manner have values that differ from typical investors.

Of course, I do not intend to broadly recommend this approach, and it is never wise to pour large sums of money in without recognizing the magnitude of the risk. However, the world of EAs has various values and stances, and it is also necessary to acknowledge the existence of diverse participants rather than criticize everything uniformly.

6. What I learned through developing and testing EAs myself

I, as an EA developer, have repeatedly designed and tested various EAs, including the Numpy Martin logic. From the experience and insights gained in that process, I want to convey something as a “real-world sense” rather than a “theoretical discussion”.

First, the biggest weakness of the Numpy Martin EA is that when faced with extreme market fluctuations, there is actually a risk of collapse.
For example, if a global financial crisis, a sudden economic event, or an unexpected shock like the COVID-19 shock occurs, the addition of positions by Numpy will continue, and the lot size will balloon like a snowball. In that case, even an EA that has accumulated stable profits in the past can actually lose most of its capital or collapse in a single drawdown.

In fact, even in multiple Numpy Martin EAs that I backtested and simulated, it was always confirmed that “even if they have maintained stable performance over a long period, in extreme market conditions the capital runs out”.
Especially, the more currency pairs and longer the test, the more you cannot ignore that “there will inevitably be a big failure somewhere.”

However, on the other hand, the important point I realized through my own verification is that risk control is never impossible.
Specifically,

• Do not make the lot size excessively large
• Set limits on the number of entries and maximum position size
• Implement rigorous money management and always ensure sufficient buffer against account equity
• Clearly set drawdown and stop-loss levels
• As a “principal recovery strategy”, withdraw only the principal when profits are realized

By combining such measures, it is actually possible to pursue long-term stable profits while significantly reducing the risk of collapse.

The important thing is, after understanding the reality that there is no logic that can absolutely avoid collapse, to calmly assess how much risk you can tolerate and implement appropriate controls.
In my experience, even if you cannot make risk completely zero, you can still sufficiently keep it within an acceptable range.

7. Typical Patterns of Failure for the Nani Pin Martingale EA

No matter how carefully designed and tested the Nani Pin Martingale EA is, it is impossible to eliminate the risk of failure. So, in what situations or patterns is failure likely to occur?
Based on my own testing and industry cases, I summarize representative patterns.

First and most common are those caused by “strongly trending markets moving in one direction” or “large-scale sudden events”.
For example, if the foreign exchange market falls sharply or rises sharply in a short period and the movement continues without reversal, positions and lot sizes accumulate through averaging down.
The logic is originally built on the premise that it will “reverse somewhere”, but if the market continues to move strongly without reversing, it leads to loss cuts or forced liquidation due to margin deficiency, causing the account to lose most or all of its funds.

Also, if the EA’s logic design is immature, the risk of failure increases.

• The increase in lot size is set too aggressively
• The maximum number of positions or risk control limits are too lenient
• Automatic stop-loss or emergency stop functions are not incorporated during high-risk situations

Such EAs, even if they experience a temporary period of stability, often end up on a path of eventually losing all their funds.

Furthermore, the slash-and-burn IB business model and sellers’ “unreasonable lot settings or leverage recommendations” also significantly increase users’ risk of failure.
In the pursuit of high profits in a short period, they push risk onto users, and even if they fail, they think “just acquire the next customer” – this irresponsible operation also leads to a decline in overall industry reliability.

In conclusion, the risk of failure for the Nani Pin Martingale EA is likely to manifest from three aspects: “extreme markets”, “weak design and operation”, and “low-moral business models”. It is necessary to keep this reality in mind.

8. Why EAs That Succeed in Long‑Term Operation Still Exist

While many N‑pmin Martin EAs are said to eventually fail, in reality there are indeed EAs that can operate stably without failure for several years. In my own work on back‑testing, forward‑testing, and verification of such EAs, I have identified several common traits of EAs that can achieve long‑term operation.

First, the premise is that risk management is designed with extreme prudence.
For example,

• The increase in lot size is kept in check
• Clear limits are set on the maximum number of positions and entries
• The operating lot is structured to be reasonable relative to the total capital
• Safety features such as automatic stop‑out and forced liquidation are built in during abnormal market conditions

EAs that rigorously implement such defensive measures are relatively resilient to extreme market swings and can reduce the risk of major failure during the operation period.

Also, the operator’s mindset and strict adherence to rules are key success factors.
For example, rules such as “withdraw the principal once a certain profit threshold is reached and only take risks with the remaining funds” or “stop operation immediately if a large drawdown occurs” are simple yet many people fail to implement them. By following these rules, it is possible to keep failure risk low while securing operating profits.

Among the EAs I tested, there were examples that steadily accumulated assets over several years without experiencing a large drawdown. However, all of them shared a logic and design that prioritized survivability over capital efficiency.
I never aim for a flashy upward trend alone; instead, I prioritize designing and operating with the principle of “how to protect capital” — that is, I believe this is the greatest point for long‑term operational success.

Of course, no EA, however excellent, can guarantee that it will never fail, but my conclusion from testing is that when the right design and right operation come together, even a N‑pmin Martin EA can achieve long‑term stable operation.

Key Points of Risk Management According to EA Researchers and Testers

To run a Numpin Martin EA safely and for as long as possible, it is not an exaggeration to say that “risk management” is everything.
I have repeatedly developed, backtested, and simulated various EAs, and I have felt the fact that EAs with weak risk management fail sooner, whereas those with solid management are more likely to survive.

First and foremost, you should focus on the principal recovery strategy.
This involves withdrawing only the original principal invested at the outset when a certain amount of profit has been achieved, and continuing to operate with only the remaining profit. By doing so, even in the worst case, you can create a situation where you have avoided loss of your own capital.
Not limited to the Numpin Martin EA, in high‑risk operations, this “principal recovery” is the most critical defense.

Next, the clarification of drawdown and loss tolerance lines.
Decide in advance the specific numbers for how much loss you can tolerate and at what drawdown percentage you will pause operations.
Continuing to operate optimistically with the thought that the market will eventually recover without setting these limits is a typical pattern that ultimately results in losing all capital.

Also, strict limits on lot size and maximum position count are essential.
The larger they are, the greater the short‑term profit, but the closer you get to failure.
Set the EA settings to limit the lot and position count to what you can tolerate even after many consecutive losses.

Finally, the key is to understand that a “failure‑proof operation” does not exist, and to adopt a calm, measured approach rather than blind faith or total denial.
I, too, once became obsessed with the quest for a “holy grail that never loses” during the repeated development and testing of EAs, but ultimately I realized the importance of deciding for myself how much risk to accept and where to withdraw, and operating in a way I can accept.

I hope readers will also prioritize thorough risk management, not just the pursuit of profit, and work well with EAs.

10. Frequently Asked Questions (FAQ)

Q1. Why is the Nampin Martin EA considered dangerous?
A. The Nampin Martin EA carries an inherently high risk of significant losses or account failure because position sizes and lots can expand if the market does not revert as expected. In particular, during extreme market fluctuations, capital can be lost at a speed faster than imagined.

Q2. What specifically should I do to implement a principal recovery strategy?
A. For example, if you start by depositing 100,000 yen and begin trading, once profits exceed 100,000 yen, withdraw the original 100,000 yen and continue operating with only the remaining profits. This way, even in the worst case, you can ensure a “zero loss” situation.

Q3. Is it illegal to use the Nampin Martin EA in overseas FX?
A. From my personal standpoint, I cannot recommend or endorse overseas FX usage. However, under Japanese law, individuals using overseas FX at their own risk are generally outside regulatory scope. On the other hand, conducting IB business (such as client referrals) within Japan without permission is illegal, so please be cautious.

Q4. Does the Nampin Martin EA work even with domestic FX leverage (up to 30x)?
A. I actually performed backtests and validations under the condition of a maximum 30x leverage from a domestic Japanese FX broker. Even under this condition, the Nampin Martin EA operates effectively. In fact, it can be easier to manage risk and operate than in environments with excessively high leverage. (Beatrice Nova)

Q5. What are the features of a Nampin Martin EA that makes it less likely to fail?
A. It sets firm limits on lot increments and maximum position counts, prioritizing a “protect capital” design philosophy over profit maximization. Additionally, by rigorously enforcing rules such as principal recovery and drawdown management, the operator can significantly reduce the risk of failure.

Q6. Is it acceptable to use it in a game-like manner?
A. Using it as a casual pastime with a small amount is a personal choice, but you should never invest large sums or use it without fully understanding the risks.

Q7. What precautions should be taken regarding IB business and online casino-related EAs?
A. Operating an unlicensed IB business in Japan is prohibited by law. Moreover, using online casinos is a clear gambling offense and is harshly punished. Do not get involved in these activities.

11. Summary

Regarding the Numpin-Martin EA, while many negative opinions such as “it will definitely fail” or “it’s dangerous” can be seen on the internet and social media, in reality there are indeed EAs that have been consistently profitable over a long period, and there are also users who enjoy operating while managing risk.

In this article, based on my own experience in EA development and testing and real-world insights, I have explained the mechanism and risks of the Numpin-Martin EA, as well as typical patterns that are prone to failure and design philosophies that enable long-term operation.
To prepare for extreme market fluctuations, risk management such as principal recovery and drawdown limits is more important than anything else, and by strictly following the EA’s settings and operating rules, you can greatly reduce the risk of failure.

I also explained the slash-and-burn business model that negatively impacts the entire industry and the legal regulatory points. Whether domestically or internationally, I feel again how important it is to interact with EAs within a healthy scope while following the rules.
On the other hand, there is also a user base that uses it more as a “game” than an investment, and the coexistence of diverse values is also a characteristic of this field.

Finally, no EA is absolutely safe.
However, if you “understand the mechanism well, accept realistic risks, and use it within the scope you can manage responsibly” — as long as you keep that, the EA is never just a “dangerous entity.”

How you interact with an EA varies from person to person.
Depending on your own style, purpose, and risk tolerance, I sincerely recommend that you make calm and wise decisions as a developer and researcher.