i believe a system should be traded exactly how u found it, however analysis into each trades (analysis NOT involvement) could reveal important stuff and individual trades that you would make you reconsider the system, for example are the gains equated for the most part where each trade and loser is about the same? is there one trade or few trades that are responsible for a large amount of the overall profits or losses? is there a time period where most gains or losses came from? if so u can eliminate that period all together whats the worse loser? could be prevented? if so how many winners would it have erased with it? (for example if a major loser was because of a support broken, then before u say i can simply not trade if support is broken, u must look at the times where support was broken and the trade still worked and was profitable) what ever changes you do it must be standardized in my opinion, meaning a change that is from the top to the bottom that the same standard is being applied to every trade. the more u stray away the more discretionary your becoming without knowing it. keep in mind my trading is swing and back testing there might vary drastically from yours on Brexit in one of the pairs i was trading i came in long and i got hammered that day but overall the pair was profitable
also ill leave u with one important thing i picked up from William Eckhardt, and that its better to trade every signal or even even if u know u might lose, if u lose its not end of the world, u will make it up, if u dont trade it though and it was a big winner then it tends to have this reverberating effect that keeps on coming back to you which affects ur psyche
He also said this:"...the analysis of commodity markets is prone to pitfalls in statistical inference, and if one uses these tools without having a good foundational understanding, it’s easy to get in trouble". Trading every signal seems to counter the idea of having a good foundational understanding. You sure you know what you are doing there, Rufus?
that could be very true overnight, but who is to say or quantify whats a foundational understanding like? do i know what iam doing? i dont think my opinion on that or urs matter, the results for me been better when i play every hand, maybe iam getting lucky? maybe but until it stops working or a i discover something better then ill change, good question, made me think for now the one thing i do make sure is that if what iam doing doesn't lose me a lot when it stops working cuz its going to since nothing is forever, iam doing that by integrating the stops in the system and making sure the losses are significantly smaller than the winners, what u think bud?
dont forget, i believe he only trades commodities, so far for me most of my success came from forex, i still hold off on commodities cuz i cant standardize size of the trade unless my account is ultra large
I am neither "bud", nor your buddy. Here's what I "think", based upon the conglomeration of all you have posted here, and that people are starting to call you on. It's an intelligent, creative response which puts it into better perspective and concision than I ever could, and might introduce you to a way to make things work for you with relaxation techniques. Or something.
Thanks you systematictrader, I agree with you stated. If signal occurs, take based on prior system performance. It's simple to me now once I understand. However I want to trade the system with my hard earn real money, i better back test it that same way. Thanks
what if you get hungry and quit trading to get something to eat? Or worse....had to make an urgent trip to the john....for 30 minutes...so for that day you have just turned into to a discretionary trader?
Hello Turveyd, I am back testing with Ninja Trader using the OHLC data. My first time back testing and confused why they no have the tick data. I believe this will cause inaccurate back testing results. Thanks