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BackTesting and Programming Planning

  #4 (permalink)

Houston
 
 
Posts: 101 since Dec 2016
Thanks: 35 given, 48 received


tpredictor View Post
My way of thinking has always been to derive from strengths. If you have a strong ability to read the market then discretionary trading can make sense. If you have a strong programming and quantitative background then trading systems can make sense. It sounds like you fell down the trap of a type of quasi-mechanical style of trading that doesn't have any real advantage.

I think you are setting yourself too many hurdles. As part of a project, I was recently teaching a friend different base systems and she said, "I have to learn this perfectly". And, I was thinking, well uhm no you really don't have to learn it perfectly because I make mistakes all the time but you do have to understand it. It sounds like you are setting yourself a bar too high.

Yes, I agree Tradestation is excellent for prototyping systems. Ninja is very strong too. There are other good products but those are the most accessible that I know. Wealth-Lab is also good but requires a Fidelity account and funded. Data analysis platforms like R, Python, and Matlab may also be useful. Metatrader is popular among Forex traders.

Beyond the programming, the more important skills are strong data analysis and creative thinking. While futures are arguably the most profitable markets/instruments to trade, they are some of the worst for deploying and developing trading systems because the amount required per system tends not to be insignificant.

If you really have a "decent size money" for trading then funding a 5k account for Tradestation should not require much thought and is worth it. NinjaTrader is popular because it is free and more open than other platforms. So, you will find more third party add-ons.

For you, I would advise the following:

1. Reassess why you got into trading. You may have hidden strengths or talents that could change the optimal plan.
2. Start with Tradestation and Easylanguage. It will be easier than attempting to learn C#. C# is my favorite general purpose programming language. However, Easylanguage is excellent for prototyping simple systems and should be easier to learn.
3. Set yourself a deadline for launching your new system. Make it something urgent. Give yourself let's say 90 days.
4. Launch whatever you have. If you can't blow 5k-10k then consider developing for Forex. MetaTrader is a platform you should look at in that case.
5. Now you can start learning.

One other word of caution, even most automated traders do monitor their systems actively.

Thank you so much tpredictor for your advice and input.


tpredictor View Post
My way of thinking has always been to derive from strengths. If you have a strong ability to read the market then discretionary trading can make sense.

I enjoy waking up and reading the charts and making decision on entry based predefined resistance and support and trendline. I enjoy reading the price.

However my backtesting of my rule based discretionary trading has not been properly documented, so all my data collect may be miscalculated per say. As you mentioned above, I need to properly backtest and collect the right data. I am currently working on this.



tpredictor View Post
I think you are setting yourself too many hurdles.

I am not sure I understand this.
Thanks, but it has to be done. If I have trading idea(s), I need to learn how to manual backtest it (50-100 trades) efficiently and then program it and backtest over a historical data. Is this not what other traders are doing? Its either this or continue forward testing a system that may not work in a year from now. Nothing gained in a year, but learning experiences and chart screen time.


tpredictor View Post
Beyond the programming, the more important skills are strong data analysis and creative thinking.

I agree. I recenetly purchased Building Winning Algorithmic Trading Systems from Kevin Davey. I believe my weakness is collecting and interperting data analysis. I believe over time, my creative will grow. I have strong logical systematic skills.


tpredictor View Post
For you, I would advise the following:

1. Reassess why you got into trading. You may have hidden strengths or talents that could change the optimal plan.
2. Start with Tradestation and Easylanguage. It will be easier than attempting to learn C#. C# is my favorite general purpose programming language. However, Easylanguage is excellent for prototyping simple systems and should be easier to learn.
3. Set yourself a deadline for launching your new system. Make it something urgent. Give yourself let's say 90 days.
4. Launch whatever you have. If you can't blow 5k-10k then consider developing for Forex. MetaTrader is a platform you should look at in that case.
5. Now you can start learning.

Thanks for the advise.

I got into trading to make additional money other then my full time, and I like analyical and systemtic thinking. And I enjoy making money is quick fashion based on my own idea and no boss.
Many have recommended Tradestation to me. Thank you. I like anyting easier.
I will not blowing any money, that is for sure. I will paper trade what every system(s) I develop and trade with 1 contract live and continue that way.

Thanks for your input.

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