Wanting to start a systematic trading approach

Discussion in 'Professional Trading' started by c.chugani, Aug 20, 2006.

  1. humble1

    humble1

    "Hell, someone could even recommend a book that outlines the necessary steps one should take to develop their own personal trading method which suits their own needs."

    http://www.edwards-magee.com/

    Trading for a living by Dr. Elder
     
    #31     Aug 23, 2006
  2. I'm interested. :)
     
    #32     Aug 23, 2006

  3. open an account with a good broker that offers u a papertrading facility; IB should do just fine. read the various pdfs instructions on their website, there u'll understand how tws [trader workstation platform] works...learn about orders routing and try to place a few trades to get a feel for it. only way to learn how to trade is by spending countless hours of screen time and by trial and error [losing trades].. books, seminars are all useless crap, even for a beginner.

    u got a long long road ahead of u, good luck.
     
    #33     Aug 23, 2006
  4. kut2k2

    kut2k2

    I tried posting the following as an attachment but all the formating disappeared. Let's try it again:


    The following spreadsheet template is for backtesting an eod stock trading strategy.

    The first 7 columns are the free eod stock data from finance.yahoo.com

    "999" is just a sample last-row number, not necessarily your actual last row.

    The numbers of greatest interest are L4 (must be >=30 for statistical significance) and P4 (must be >1 for a useful strategy).



    Cell Description
    ----------------------------------------
    A1 “XYZ” { stock symbol }
    A3 “Date”
    A4 { most recent date in backtest }
    ... ...
    A999 { oldest date in backtest }
    B3 “Open”
    C3 “High”
    D3 “Low”
    E3 “Close”
    F3 “Volume”
    G3 “Adj. Close”

    H3 “Typical Price” { ... slippage from the open (ideal trade price) }
    H4 @AVG(B4..D4)*G4/E4
    ... ...
    H999 @AVG(B999..D999)*G999/E999

    I3 “Strategy being tested”
    I4 { buy signal, sell signal, or hold (no action) }
    ... ...

    J3 “Market Position” { number of shares owned }
    J4 @IF(I5={buy}#AND#J5<=0, @INT(O4/H4),
    @IF(I5={sell}#AND#J5>=0,
    @IF(B4=C4#AND#D4=E4, 0, -1*@INT(O4/H4)), J5))
    ... ...
    J999 +100

    K3 “Transaction Price”
    K4 @IF(J4=J5, K5, H4)
    ... ...
    K999 +H999

    L3 “Completed Trade Count”
    L4 @IF((I5={buy}#AND#J5<0)#OR#(I5={sell}#AND#J5>0), L5+1, L5)
    ... ...
    L999 +0

    M3 “Equity, last transaction”
    M4 @IF(J4=J5, M5, O4)
    ... ...
    M999 +J999*K999

    N3 “Equity, last completed trade”
    N4 @IF(L4=L5, N5, O4)
    ... ...
    N999 +J999*K999

    O1 { completed-trade commission }
    O3 “EQUITY”
    O4 @IF(L4=0, J$999*H4, M5 + J5*(H4-K5) - O$1*(G4/E4)*(L4-L5))
    ... ...

    P3 "Buy-&-Hold Index"
    P4 +O4/(J$999*H4)
    ... ...

    Q3 "Winners Minus Losers"
    Q4 +Q5 + @SIGN(N4-N5)
    ... ...
    Q999 +0

    R3 "% Winning Trades"
    R4 @IF(L4=0, 0, 50*(Q4+L4)/L4)
    ... ...

    S3 "Gross Profits"
    S4 +S5 + @MAX(N4-N5, 0)
    ... ...
    S999 +0

    T3 "Profit Factor"
    T4 +S4/@ABS(N4-S4)
    ... ...
     
    #34     Aug 23, 2006