Minggu, 23 Oktober 2011

The Time Tested System: Trading Backtesting


Imajte na umu da je trgovanje backtesting je vrlo vrijedno ulaganje vremena i novca. To će vam dati sposobnost da razumiju vaš unutar trgovinskog sustava i izvan te će vam dati povjerenje za trgovinu sustav uspješno.

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is the process of trading backtesting test trading strategies using historical data rather than testing it in real time with real money. You have designed the system, now you need the confidence to follow through all of their trades. Through backtesting, you will get to know your system thoroughly and will therefore be able to build a foundation from which to operate.

There are three ways to backtest. First, there is a mechanical tests back, using the software, manual backtesting and paper trading, which maintains the system and trading in real time with no money in involved. With mechanical backtesting, you can take your system, defined on the set of rules and load into your software and allow the software to backtest over a period of time. This method can be difficult, if not particularly computer literate programming system for the backtesting. Also, you can program in all possible outside events. For example, how could you possibly program in the events of 11 September? It will be possible to take into account all the outside events.

manual backtesting is a better choice if you are finding it difficult software and easier to implement. However, the manual backtesting room for human error and subjectivity, which you can not find a mechanical backtesting. Paper trading, where trading in real time without using money, there are advantages and disadvantages of manual backtesting.

backtesting trading affects the first, its input and output. You can test the entire system's performance and can make the necessary adjustments needed. This will affect your money management. You can test different systems of money management through backtesting. Finally, psychology is influenced backtesting.Temeljito understanding of your strengths and weaknesses of the system will greatly enhance your trading confidence.

Without testing, the traders will lack confidence and will be tempted to modify their trading plan and to replace their system with any new wonder of Bang indicator that comes along. When trading system was backtested, however, will be able to continue trading even after a long series of losses, if historically you've seen that you can still come out ahead after the number of losses.

Without testing, the traders will lack confidence and will be tempted to modify their trading plan and to replace their system with any new wonder of Bang indicator that comes along. When trading system was backtested, however, will be able to continue trading even after a long series of losses, if historically you've seen that you can still come out ahead after the number of losses.

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What you should be looking for a good trading system with minimal drawdown and a good risk to reward ratio. Many trading systems have more losing trades than winning ones and still make money.

Please note that trading backtesting is a very worthwhile investment of time and money. This will give you the ability to understand your inside and outside the trading system and will give you the confidence to trade the system successfully.

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