@gaussian, I like your answers, but I am curious ... Let's say you have been given a task to listen to 100 elevator pitches and choose 10 most promising strategies. What would you need to hear? What would you ask? What would make you reject something immediately? You've got 10 seconds, go ...
If you are sure in your system of course you can start trading with real money but anyway you should be aware of mental biases and other sources of risk. I recommend to research more info about risk management (for example: https://capital.com/risk-management-definition). It can help you to save your money and nerves. More you know about risk management before trading with real money, less you lose after start.
Stop projecting your own failure to everyone else and open your mind. Maybe you will realise that some traders DO make good money from trade systems and then perhaps you will learn to do it yourself. Profitable systems (with the right market) can have a HUGE edge over discretionary traders as it solely rely on data and not personal bias + It will take trades 24/7 across many markets, something that a discretionary trader can't. Some hedge funds to this day still implements Simple MA trade systems, and there is nothing advanced in a MA trade system, anyone could set one up with a little guidance.
When one knows that he/she is capable of understanding the market and its moves and patterns then you can move ahead without any obstructions. Once you open a live account,use your strategies in the smallest volume trades available. And the important thing is to treat your demo account as it is a real account. In fact many experienced traders still use demo accounts to try out new methods.
The moment to operate with real money is when you feel sure of the strategy that you are going to handle, analyze everything well, for the moment it is better to manage the demo account so that you go practicing a little, although when you operate with real money there are things that change a lot
I cannot answer any of your questions But i will look all of those things up and get back to you. I only just discovered backtesting, and i landed on profitspi for this. I understood intuitively that the last two years (as far back as my current subscription allows) is not a reliable indication of success. I'm going to go ahead and pat myself on the back for that, and yes I am absolutely seeking everyone's approval. I also figured on a way to "walk-forward" test it, but i didn't know that was what it was called. I will look into monte-carlo testing now. to answer your questions, for now: 1. i don't know what this means yet 2 and 3. just looked this up, i will get back to you on it. 4. -25.5%, yes i know why and i find it acceptable. 5. yes, but in the way Dr. Malcolm explains chaos theory in Jurassic park...does that count? Or do you seriously want me to come up with a formula? Becaue that exceeds my capacity and laziness threshold, and i don't believe it would be worth the effort. Feel free to correct me if i'm wrong. 6. I'm halfway through figuring this out. I developed my strategy using three start days based on what i considered the worst time to get into the market (at a peak right before a drop), the best time (the bottom of that trough) and a neutral day (as far back as my backtester could go). 7. I'm glad i looked this up, and i will run the numbers to confirm this, but i want to say 0%. thank you for making me aware of it. 8. I want to see a 50% annual return if that is what you mean. I'm happy with a 5% outperformance of the s&p500. 9. nope, but i will put it on my todo list. I have some questions now. Once i fully test the strategy out and iron out more of the wrinkles in it, how do i even implement it? I use TDameritrade, and just opened up thinkorswim today to try out the papermoney trading feature. Bottom line is, I won't be using TOS. I plan on doing the paper trading with excel now, but any suggestion is welcomed. I will look through the sponsors of this site, and a forum search in the meantime.
I doubt a profitable fully automated trading system is achievable for a one man band retail trader. If it were easy everyone would do it. There are gazillions of Chinese, Russian, Indian, European coders on this planet. Now if collectively 1 million people attempt it, will 90% be profitable? Maybe for the first week then they would begin to lose their edge. Nearly everything works part the time, then it doesn't. The logistics of running fully automated, time, money, energy, enthusiasm, no distractions, no disasters, plus relying on 3rd parties for support on data and everything else..... Trading is getting more difficult, not easier because the competition is building.
True enough. A computer is a machine while humans aren't. Keeping multiple balls juggling in the air for any length of time is near impossible.