Strategies back test not favorable anymore

Louwrens · 2018-03-06T12:16:07+00:00

Hi I am struggling quite a lot to develop a strategy for the SAF40 that trades a few times a day. I only want to be in the market for a few hours a day at most. I like to take small profits for now as I dont have lots of capital to risk. I have build many strategies that looked great when back tested. I then ran a few of them with some success. One of them ate 60% of my capital and then i stopped them to re-asses them. For some or other reason the back test does not look that great anymore. I dont know why it changed but if it looked the way it does now i would never have started them. I know I should test them in a demo account rather than live, but I am eager to trade. Are there any short term strategies for the SAF40 already tested, if not what would be the indicator to use to develop one. I tried all the popular ones. I even bought a strategy from a company and tried to code it in, but without any success.

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03/06/2018 at 1:16 PM #64577 quote

Louwrens
Participant

Junior

Hi

I am struggling quite a lot to develop a strategy for the SAF40 that trades a few times a day. I only want to be in the market for a few hours a day at most. I like to take small profits for now as I dont have lots of capital to risk. I have build many strategies that looked great when back tested. I then ran a few of them with some success. One of them ate 60% of my capital and then i stopped them to re-asses them. For some or other reason the back test does not look that great anymore. I dont know why it changed but if it looked the way it does now i would never have started them. I know I should test them in a demo account rather than live, but I am eager to trade.

Are there any short term strategies for the SAF40 already tested, if not what would be the indicator to use to develop one. I tried all the popular ones. I even bought a strategy from a company and tried to code it in, but without any success.

03/06/2018 at 1:47 PM #64580 quote

Leo
Participant

Veteran

Hi,

I think we all try to do something like you. Some tips what I painfully learn during the process:

– use mini contracts for testing your algorithm live.

– set your maximum lost per trade

– If thinks are very bad, use the function “quit” inside the coding for deactivate the system

– if you use multiple variables and combination, then your program is prone to be overoptimize

-if you lost get the most of it and keep programming other scenarios for improve your favorite system

And do not give up. This is what keep me going on: if we make one system , at least one system! than win X euro per week then you can use it in different markets and time frames then you have X€ times (number of markets) times (number of time frames) …mmmmm yummi yumi!

Nicolas thanked this post

03/06/2018 at 1:59 PM #64581 quote

Louwrens
Participant

Junior

Hi Leo

I think this is probably my problem. I am trying to make the system so save that at some point it does not work anymore or trades only once a month. Why the back testing looks different now than it did a week ago is still very strange.

I quiet enjoy building these systems and testing them, so will keep on going. I am just stuck at the moment. Not sure how to approach and new system as it feels like I tried all the combinations of technical indicators. Oh and a lack of coding knowledge also affects this.

Leo wrote:

if you use multiple variables and combination, then your program is prone to be overoptimize –

03/06/2018 at 2:05 PM #64582 quote

Nicolas
Keymaster

Legend

Louwrens wrote:

Why the back testing looks different now than it did a week ago is still very strange.

Use tick by tick mode (always) and set correctly the spread while backtesting your strategies.

03/06/2018 at 2:16 PM #64585 quote

GraHal
Participant

Master

Hi Louwrens

Don’t be afraid to look at the general Market Structure surrounding the trade entry when it executes.

By that I mean if a trade has opened Long and the bars around the entry and higher timeframe bars are screaming Short then stop the Strategy, check / improve code, run in Demo and live to fight another day??

If you can’t read Market Structure then use the info on the link below.

Cheers
GraHal

https://www.investing.com/technical/indices-technical-summary

03/06/2018 at 9:38 PM #64624 quote

Louwrens
Participant

Junior

Thanks everyone for the comments and advise. It highly appreciated. I am afraid I am hooked on this and it will probably cost me some money.. Hopefully not for too long. 🙂
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