04-16-2018, 10:44 AM
Gekko's Backtest result page isn't very helpful. Basing your results on overall Simulated Profit is really asking for trouble. You end up 'curve fitting' for the data you have. History is the best we can do, but it is very unlikely to ever be repeated, especially not in the order it first came in.
Try looking more closely at the trades. Stretches of losses can cause trouble for your account if they come at the wrong time. Large losses might be controlled with stop-losses or other mechanisms, perhaps reducing overall profit but making the strategy more future-friendly. Consider what a few more of those large losses might do to your results. Keep them under control. Not using some form of stop-loss is unnecessary gambling. A signal for a trade in the opposite direction can sometimes be effective.
Accepting a lower overall profit for smaller stretches of losses and minimizing large losing trades will serve you well.
Most importantly, the more you squeeze every bit of overall profit from your backtesting the less likely it will work in the future. That's curve fitting. It's all about trade offs. Decent profits versus controlled, limited losses.
There are lots of helpful write-ups and videos on-line dealing with backtesting and curve fitting. Suggest you check a few of them out.
Here's the first one that came up for me in a search ... it's not bad ...
https://www.youtube.com/watch?v=kJ_6b_2icBU
Good luck!
Try looking more closely at the trades. Stretches of losses can cause trouble for your account if they come at the wrong time. Large losses might be controlled with stop-losses or other mechanisms, perhaps reducing overall profit but making the strategy more future-friendly. Consider what a few more of those large losses might do to your results. Keep them under control. Not using some form of stop-loss is unnecessary gambling. A signal for a trade in the opposite direction can sometimes be effective.
Accepting a lower overall profit for smaller stretches of losses and minimizing large losing trades will serve you well.
Most importantly, the more you squeeze every bit of overall profit from your backtesting the less likely it will work in the future. That's curve fitting. It's all about trade offs. Decent profits versus controlled, limited losses.
There are lots of helpful write-ups and videos on-line dealing with backtesting and curve fitting. Suggest you check a few of them out.
Here's the first one that came up for me in a search ... it's not bad ...
https://www.youtube.com/watch?v=kJ_6b_2icBU
Good luck!