Bad beginings

TempusFugit · 2017-03-21T10:44:52+00:00

Hello, I am working in a system based in divergences, it can be used with several indicators (RSI, MACD…), markets and timeframes. Its numbers are not spectacular but it looks quite reliable to me. Anyway, still proving it in demo and I will post it here in the future . But what I want to to talk about here is that I noticed in backtesting is that this system and others, even with a long wining system, is quite common to start the firsts months/weeks/days loosing money. Does it happen to you also? Why you think is that?

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03/25/2017 at 2:30 PM #29822 quote

GraHal
Participant

Master

I agree TF … the Bot can start loosing money with or without Elliot waves, Fib retraces… and those things can happen also 100 bars later … but if losses on trades (not at beginning) do not take my starting equity below zero then I can live with that. Reason: because I wouldn’t have that profit to lose if I had not run that Bot.

I find a loss of my starting equity a big turn-off and was only suggesting a way to limit this ‘bad beginning loss’ to some pre-defined figure (£50, £250 whatever) so that I live to fight another day. 🙂

I wasn’t suggesting that Elliott Wave Changes, Fib Retraces etc only happen when one has just started a Bot running.

This has been quite a lively discussion, certainly got me going … I think it was the emotive title that drew me to it, so thank you for that TF.

Please continue anybody, and yes I will incorporate the beginning loss limiter into my Bots in future … I’ve talked myself into it now! hahahah

Best Regards
GraHal

03/25/2017 at 4:33 PM #29843 quote
TempusFugit
Participant

Veteran
So, it seems to me that we have here two schools:
- The searchers of good beginnings: trying to avoid the painful-loosing phases of a bot
- The random walkers: doesn´t matter the moment, just man it up
AutoS, thanks for the advice, I really think you are right. But I have to start with what I have, only one system made by me and so I can really understand. That´s why earlier in this post I wonder if just one system in different markets and different TF could do the “provisional” trick about diversification.

Also very interesting and mind-shoking your (and Eric) idea that Demo is kind of useless or worse. At this point I think is an approach too ahead of my knowledge, or plainly saying it scares me too much
03/25/2017 at 8:50 PM #29853 quote

AutoStrategist
Participant

Veteran

To be clear I am NOT recommending going straight to live, I believe most (all?) serious quants use a period of incubation before going live. It’s just me being over eager and had I run in demo first I would definitely have saved some money with several of the less good strategies.
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