Topic #1: Position Sizing and Optimization 1. Is it always best to optimize and backtest using 1 share? Using this method you will find the best pure input settings without regard to position sizing. I am thinking this will get you the most accurate results when you bring your system live. 2. You can backtest and optimize by calculating position size based percentage of total equity you are willing to risk. Example: Initial Capital = $100,000, Risk = 2% per trade Assumptions: you do not recalculate Capital based on NetProfit after trades. When you readjust this way when backtesting then as your account equity grows the future trades are going to be weighted much more heavily as the position size is much larger. This is definitely NOT what we want. Here is the problem I've found backtesting with the above method. The program LOVES extremely low risk high reward ratios. It figures that if you risk less in terms of a tight stop you can put on huge position size and eventually catch something that will make a lot of money. There is some truth to this theory but in the real world slippage and the effect these large orders will have on the market make it not plausible. Question: How can you balance the reality that when you use tighter stops you can trade larger positions with the fantasy that you can trade HUGE positions with tight stops and that slippage and MM's who will stop hunt won't tear your system to shreds? 3. You can calculate position size based on use of buying power. The issue I have with this is it doesn't take into account volatility. It just looks at share price. If you have two stocks that are both $100 dollars and one has twice the range (which is used to calculate stops) then the program will buy the same position size for both these stocks even though you are risking twice as much on one compared to the other Anyone who has gone through this or has any thoughts I would be interested in some discussion.