How many years away are we from a no BS backtesting program?

[CaptainObvious]

Quote from hypostomus:

El Capitan! Why do I think that you are someone else, reincarnated under a new handle? We are having lively dialogues in the Strategy forum which all of ET is marvelling at. Models of civility and decorum! I invite you to start a thread there and wow us with your wisdom. The ability to alliterate is appreciated, if not required. I personally will hang on every word! Help me renovate ET, polish its brass, and return it to its former glory!

The high regard in which you hold my alleged new handle is not deserved. I am new to the forum and have more to learn than to teach. I will share my defeats as well as my victories and do my best to stay out of the ever present flame war. Traders helping traders in my mantra. All while keeping a sense of humor. Tall order! Thank you for the invite to the strategy forum. I will make my appearance in due time. Until then....good trades!

 

[FaderTraderr]

Backtesting is horseshit. You need to develop a strategy separate and apart from backtesting.

This is not to say that you can't take your strategy, which works on a particular instrument and create a filter through which to run trading candidates, adjust leverage and such. But, to look for an actual trading strategy via backtesting is a collossal waste of time. At least if you lose money in the markets while trading on a discretionary basis, you'll learn the err of your ways and understand that testing vanilla strategies against entire indices of stocks is imbecillic.

 

[HoundDogOne]

His real question:

When will free money be available to everyone... even lazy dopes like me?

 

[QQQShort]

Quote from krosny:

Hi!
Newbie here. One message I'm getting in this forum is that today's backtesting programs simply aren't sophisticated enough to account for real world trading conditions. Is there a backtesting program in existence today that gives you a no BS real world simulation of bottom line, in the bank, before tax profits? Or are we still years away from such a program?

There are programs available today that provide reasonable real world simulations using historical data. As Mark said in his post, it is difficult for any one program to be all things to all people. What features have you not been able to find?

 

[DrChaos]

Quote from CaptainObvious:

Never! Backtesting is a fools paradise. All systems work some of the time, no system works all of the time. Start with S/R, add a moving average or two, and trade. Strict money management is the real key to success.

Uh, no it isn't. High, sustained expectancy is the essential key.

Money management just changes the ordering that money comes in----or leaves----and that can make things somewhat more or less pleasant. Unless changing your size changes the expectancy, in which case it is part of your trading and not money management, by definition.

In the end, you must jump in to the live fire. Good luck, and welcome to the frey.

In theory, practice and theory are not very different. In practice, they are.

 

[QQQShort]

Quote from DrChaos:

Uh, no it isn't. High, sustained expectancy is the essential key.

Money management just changes the ordering that money comes in----or leaves----and that can make things somewhat more or less pleasant. Unless changing your size changes the expectancy, in which case it is part of your trading and not money management, by definition.



In theory, practice and theory are not very different. In practice, they are.

Very well said.

 

[leonnis]

Quote from krosny:

Hi!
Newbie here. One message I'm getting in this forum is that today's backtesting programs simply aren't sophisticated enough to account for real world trading conditions. Is there a backtesting program in existence today that gives you a no BS real world simulation of bottom line, in the bank, before tax profits? Or are we still years away from such a program?

Most people i've met that are succesful traders don't seem to use a backtesting program. I used to use Tradestation's easy language but i found it was much easier to set hard standards for trading and stick with them.
dan

 

[QQQShort]

Quote from leonnis:

Most people i've met that are succesful traders don't seem to use a backtesting program. I used to use Tradestation's easy language but i found it was much easier to set hard standards for trading and stick with them.
dan

Without the benefit of back test results, what benchmark do you use to monitor whether your system has lost its edge?

 

[horribilicus]

Quote from QQQShort:

Without the benefit of back test results, what benchmark do you use to monitor whether your system has lost its edge?

http://www.elitetrader.com/vb/showthread.php?s=&postid=1093654&highlight=test+and+ddoc#post1093654

 

[leonnis]

Quote from QQQShort:

Without the benefit of back test results, what benchmark do you use to monitor whether your system has lost its edge?

Well it turned out, over the years that i don't buy or sell "naked" stocks or etf's without hedging with options. I know exactly how much i can make to the penny. Likewise the loss. The odds have to be in my favor or i don't do it. Thats the edge for me.