Hi All, I am very new amibroker user, I’ve been experimenting with some simplistic back testing on asx historical equities. I have a query around recommended position sizing methods during back testing and would greatly appreciate any guidance or reference to historical threads that would have discussed this in the past.
Initially I was using a fixed percentage of capital and a maximum number of open positions as an input but with 100k starting capital and 5pct capital allocation per trade the trade size grows over long testing periods to what seems unrealistic levels to me. As a counter to this I run a fixed $ amount per trade as an input with an increase to the maximum number of open positions.
Over the same system the fixed $ amount per trade approximately halves CAGR versus the 5pct capital allocation.
I would be greatful to hear if I’m way of the mark with this kind of approach to position sizing in terms of good practice to generating back testing results and any other recommended methods I could investigate.