I've been forward testing and continually refining my system at www.virtualstockexchange.com for almost 2 years now.
How Much $$$ for Slippage and Commission?
- Thread starter Corso482
- Start date
I've been forward testing and continually refining my system at www.virtualstockexchange.com for almost 2 years now.
What makes you think the forces that influenced prices in the past will exist in the future?
Without getting into the specifics, my style finds strong stocks that are temporarily pulling back and vice versa. That's a simplistic description, but it captures the basic logic behind my system.
There's no guarantee it'll keep working, but what I've just described, in my opinion, will always occur.
I feel that the logic behind my style is logical, simple and robust. Successful backtesting and forward testing (on paper) has only encouraged me.
Why would he? I wouldn't.
Annoying active EliteTraders for 25 years in a string alone won't be enough to become a trader. You will need to actually read 2+m of books on diversified trading subjects (a 5m pile on Gann won't cut it mate), do all the paper trades & analyses detailed in there, try everything you can, exchange, paper trade in esignal or whatever for a coupla years - Once you're profitable consistently (try 65-75% hitrate on stocks intraday & a sterling ratio of 1.5 or higher), you can consider trading lots of 100 shares - Just to gently introduce you to the psychology of real-life battle. Once you've done that for 6 months successfully, you can start increasing your positions.
For an average person I'd say trading heavier than that in your first 6 months is outright silly, since you will stop / be impaired from absorbing knowledge when you're psychologically challenged by your net P/L... (Swimming in Adrenaline, that is...)
As for the slippage & comm thing, testing trading systems, I'd say here that personally, I rarely go less than $0.03 (3 cents) - if not 5 cents or more per share, often 10-20 cents for s/c, if your system still shows returns.
Look at NTES for example - Using nothing more than a 10EMA crossover on a 10-M chart, considering $0.10 s/c per trade, you would still have returned 23.61% in a total of 15 trades for the last 5 days tested, with a %profitability of 86.66%.
That's just hypothetical, and c/s can be more than that. However, trading can sometimes be so simple it's boring - That's what you have to try looking for. It works well for me. It sets off the remaining liquidity I have left after holding/shorting futures contracts. This way my money is always in the market (also day & swing - trading equities)
If your choice stock doesn't look this good even in a backtest - forget it. The reality is always worse, never better. Hope or good faith has no place in trading. Dump the stock and look for a better one. Look at a few. Just looking through the 500 most important stocks should be enough for now...
Good Luck,
~Scientist
Good Luck on your journey with a 98% chance of failure!
~Scientist.
