We had a saying back when I was a pilot, "There are old pilots and there are bold pilots, but there aren't a lot of old bold pilots". You couldn't be more wrong about the role of rational, logical analysis in trading, but by all means, be bold, irrational, and illogical. "Snowflakes" like me appreciate having people like you and southall as counterparties!
Kinda funny how the bile in this sort of thread always comes from those who oppose papertrading -- something which no one has ever forced them to do.
It is good idea to use paper trading to debug API trading software. It is also good idea to paper trade new trading platform to learn the platform ins and outs and to test its responsiveness. However, it is a waste of time to be back testing strategies based on historical or stale data and think that will increase your chances of success. Why? Because the market is always into forward looking mode, and seldom looks back into the rearview mirror. In the end, each to his own and I guess that is what makes a market!
Question 1: Did you ever try to do this? And if you did, how long? Question 2: Are you sure that you are the best qualified person on earth? Just to be sure that nobody can because you cannot, as the best qualified person on earth. Ever heard of behavioural finance? http://www.behaviouralfinance.net/ Your last sentence is the best one.
That question is irrelevant. Even if you spend hours and hours in a simulator, you still cannot just then jump into an airplane without an instructor by your side "live". To do otherwise would be fatal. And after you spend hours with an instructor "live" in the cockpit, you are then slowly let off the leash in solo patterns around the airport while your instructor watches you from the tower. Then you are let off the leash a bit more and allowed to go short cross-country solo. Your performance is reviewed. And reviewed. And reviewed. Only when you reach the level of proficiency that your instructor feels he can sign off on your particular certificate, and you meet the minimum amount of training hours the FAA requires for said certificate, and then pass the FAA instructor's flight review, are you allowed to roam fully-free on your own. To analogize sim trading with sim flying is a bit lacking I think, because they are kinda' different animals.
Every year every pilot had to go back for a week in the sim, which was one of those big beasts in a gymnasium size room with giant hydraulic arms to give you full motion and an exact replica of the cockpit where all the switches and instruments worked exactly like the real thing. I want to say it was 8 hours of flight time, half as pilot and half as copilot, plus about that same amount of time in briefing and debrief. You pretty much ran through every emergency proceeded you couldn't do in the actual aircraft (engine fires, loss of lube, non-obvious instrument failures in instrument conditions, instrument autos...) As well as as a bunch of compound emergencies. It was actually always a pretty stressful week, but when you had a real emergency it was almost easy by comparison so definitely worthwhile. Flying is a bit like trading in that everyone thinks it's this high risk, top gun kind of thing but in actuality pilots are the most analytical, methodical, risk averse people you'll meet.
Professional baseball players, golfers, marksmen, etc. all spend countless hours "training". I have also spent many hours trading SIM to hone my skills because backtesting does not offer me the same real time trading environment that forward testing in SIM does. Patience, strategies, and platform mastery comes with hours of practice, at least for me...but then again I have the advantage of time to do so. While I agree that eventually you must jump in the ring, SIM trading is a valuable tool if you take it seriously. It can be the difference between being successful and calling a "Top" on a web forum.
I have seen two extreme opinions on back tests. I have had a co-worker that thought that it's worthless and even harmful. I have had a junior that thought that Sharpe of X in historical simulation will be equal to same in live trading. In reality, the value of back tests and simulation are somewhere in between the two, depending on the exact nature of your strategy.
Let us be clear here. 1) When I started, trading there was no such thing as back testing and sim trading programs so I learned the hard way and I paid my dues to Mr. Market. 2) I never claimed to be an authority on back testing or sim programs; I simply quoted Mr. Gil Blake, who claims to be an Inventor of mutual fund timing strategies. However, I can tell you this, you can sim trade and back test until the cows come home, and you will never be able to learn all the techniques and tricks the market maker preform with the order flow; for that, my friend you have to pay your dues.