Welcome to NexusFi: the best trading community on the planet, with over 150,000 members Sign Up Now for Free
Genuine reviews from real traders, not fake reviews from stealth vendors
Quality education from leading professional traders
We are a friendly, helpful, and positive community
We do not tolerate rude behavior, trolling, or vendors advertising in posts
We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community. It's free for basic access, or support us by becoming an Elite Member -- see if you qualify for a discount below.
-- Big Mike, Site Administrator
(If you already have an account, login at the top of the page)
I haven't backtested the strategy I've been using for almost 2 years now. It's outperforming my algo strats by a longs shot. Only you will know if you need to backtest. In general, most strategies should be backtested. I would presume most traders curve fit their backtests until the results are to their liking. My backtests consist of running the strategy through 20 instruments and then picking the top 8 to work with.
For the average algo/backtested trader i would suggest the majority of systems are nothing much beyond Discretionary trading systems converted to maths , clearly this isnt an easily accomplished task and is where most fail . The average discretionary trader really is a rules based trader in the main and 'if" they could test and quantify their trades mathematically it becomes exponentially easier to identify areas that are letting you down . Backtesting done on robust contexted mathematical systems will 100% improve your trading faster than any other process . AND if it doesnt i suggest your conversion of thoughts into maths is where you are failing , not the actual backtest process . Logical progressive code writing is not easy and i think many make the mistake of giving up quickly after getting no tangible results in the short term . I can attest that after taking the algo route that solid and regularly reliable results took years not months . Even a failed backtest that most would bin immediately can be extremely revealing . Just analyzing equity curve against market price action can reveal weak points in literally seconds . what type of market conditions are the Drawdowns occurring in and is there a solid correlation between the 2 ? if there is you have an area to isolate and improve .
If you go down this road be patient , work hard on converting all the rules of 'discretionary " systems into binary maths decision trees . Some areas of the flow chart of questions you ask price and time need more than 2 outputs with further questioning to get that binary result . Contrary to a lot of popular opinion robust algos will be complex . too many think simple is best and dont challenge their intellect enough to find the answers to complex decision trees . Keep the complex as simple as you can sure but not at the expense of robust binary decisions . There are no shortcuts going down this path . Its a challenging task to turn thoughts into maths and developing the skillset/tools to achieve this but its the shortest path to building robust binary systems /// if , or , then , else , once , while , do , for are all aspects that can and need to be included in robust systems . CONTEXT adds substance .. Good luck to all