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Let's talk about strategy development
When I test a new strategy the first thing i want to know is "How did it handle trading in the year 2011" - (2011) was a savage year for those who traded through it, hindsight is a good measure of any strategy worth its salt. My initial testing of a new strategy in development has to pass the basic metric before moving on by stress testing it against my favourite metrics (that have been discussed in previous posts).

Sticking with the All Ordinaries
My initial testing concentrates on the All Ordinaries, the market I trade as it has a goldilock level of volatility that we as traders all need. Before you ask, the ASX 200 is not suitable if you are planning to make some serious coin quickly in the markets (I'm first to admit the ASX 200 is a safer alternative if you have a lower risk profile) Moving on - the strategy has to perform over the entire Australian market, a good test but less meaning full.

You can buy a robust strategy
Some commercial strategies that you can buy are suitable for a range of markets no matter where you are in the world - they are generic in nature with patchy results at best, meaning the commercial strategy "is a one size fits all approach". What's the advantage of buying a strategy - (a) saves time trying to learn how to code & (b) it lets you gets a foot in the door quickly. Most commercial strategies contain parameter setting so you can alter, tuning them into the markets being traded. To be fair, (a) commercial turn-key strategies are cheap (b) they have been robustly developed & tested (c) the coder has no idea how & where the strategies are going to be traded. Just remember: one strategy doesn't fit all.

It's worth remembering
You're up against traders who will have more experience, more information & much more money than you so leave all your dreams of making quick and easy money, behind & concentrate on your survival. Your absolute first goal is to learn how to stay in the game & as with boxing you need to keep on your feet at all times, that's your one job.

A suggested "good read"
[USER=50018]@Newt[/USER] suggested a great book, endorsed by myself & [USER=13908]@peter2[/USER] - "Trade Like an O'Neil Disciple: How We Made Over 18,000% in the Stock Market" Now I'm suggestion another book not related to trading but in my opinion a must read for everyone.

Fooled by Randomness
"Fooled by Randomness" by Nassim Nicholas Taleb
This book explains why some people are successful where others aren't so lucky.

Skate.

<blockquote data-quote="Skate" data-source="post: 1057433" data-attributes="member: 57364">Let&#039;s talk about strategy developmentWhen I test a new strategy the first thing i want to know is &quot;How did it handle trading in the year 2011&quot; - (2011) was a savage year for those who traded through it, hindsight is a good measure of any strategy worth its salt. My initial testing of a new strategy in development has to pass the basic metric before moving on by stress testing it against my favourite metrics (that have been discussed in previous posts). Sticking with the All OrdinariesMy initial testing concentrates on the All Ordinaries, the market I trade as it has a goldilock level of volatility that we as traders all need. Before you ask, the ASX 200 is not suitable if you are planning to make some serious coin quickly in the markets (I&#039;m first to admit the ASX 200 is a safer alternative if you have a lower risk profile) Moving on - the strategy has to perform over the entire Australian market, a good test but less meaning full. You can buy a robust strategySome commercial strategies that you can buy are suitable for a range of markets no matter where you are in the world - they are generic in nature with patchy results at best, meaning the commercial strategy &quot;is a one size fits all approach&quot;. What&#039;s the advantage of buying a strategy - (a) saves time trying to learn how to code &amp; (b) it lets you gets a foot in the door quickly. Most commercial strategies contain parameter setting so you can alter, tuning them into the markets being traded. To be fair, (a) commercial turn-key strategies are cheap (b) they have been robustly developed &amp; tested (c) the coder has no idea how &amp; where the strategies are going to be traded. Just remember: one strategy doesn&#039;t fit all.It&#039;s worth rememberingYou&#039;re up against traders who will have more experience, more information &amp; much more money than you so leave all your dreams of making quick and easy money, behind &amp; concentrate on your survival. Your absolute first goal is to learn how to stay in the game &amp; as with boxing you need to keep on your feet at all times, that&#039;s your one job.A suggested &quot;good read&quot;[USER=50018]@Newt[/USER] suggested a great book, endorsed by myself &amp; [USER=13908]@peter2[/USER] - &quot;Trade Like an O&#039;Neil Disciple: How We Made Over 18,000% in the Stock Market&quot; Now I&#039;m suggestion another book not related to trading but in my opinion a must read for everyone.Fooled by Randomness&quot;Fooled by Randomness&quot; by Nassim Nicholas TalebThis book explains why some people are successful where others aren&#039;t so lucky.Skate.</blockquote>

[QUOTE="Skate, post: 1057433, member: 57364"] [B]Let's talk about strategy development[/B] When I test a new strategy the first thing i want to know is "How did it handle trading in the year 2011" - (2011) was a savage year for those who traded through it, hindsight is a good measure of any strategy worth its salt. My initial testing of a new strategy in development has to pass the basic metric before moving on by stress testing it against my favourite metrics (that have been discussed in previous posts). [B]Sticking with the All Ordinaries[/B] My initial testing concentrates on the All Ordinaries, the market I trade as it has a goldilock level of volatility that we as traders all need. Before you ask, the ASX 200 is not suitable if you are planning to make some serious coin quickly in the markets (I'm first to admit the ASX 200 is a safer alternative if you have a lower risk profile) Moving on - the strategy has to perform over the entire Australian market, a good test but less meaning full. [B]You can buy a robust strategy[/B] Some commercial strategies that you can buy are suitable for a range of markets no matter where you are in the world - they are generic in nature with patchy results at best, meaning the commercial strategy "is a one size fits all approach". What's the advantage of buying a strategy - (a) saves time trying to learn how to code & (b) it lets you gets a foot in the door quickly. Most commercial strategies contain parameter setting so you can alter, tuning them into the markets being traded. To be fair, (a) commercial turn-key strategies are cheap (b) they have been robustly developed & tested (c) the coder has no idea how & where the strategies are going to be traded. Just remember: one strategy doesn't fit all. [B]It's worth remembering[/B] You're up against traders who will have more experience, more information & much more money than you so leave all your dreams of making quick and easy money, behind & concentrate on your survival. Your absolute first goal is to learn how to stay in the game & as with boxing you need to keep on your feet at all times, that's your one job. [B]A suggested "good read"[/B] [USER=50018]@Newt[/USER] suggested a great book, endorsed by myself & [USER=13908]@peter2[/USER] - "Trade Like an O'Neil Disciple: How We Made Over 18,000% in the Stock Market" Now I'm suggestion another book not related to trading but in my opinion a must read for everyone. [B]Fooled by Randomness[/B] "Fooled by Randomness" by Nassim Nicholas Taleb This book explains why some people are successful where others aren't so lucky. Skate. [/QUOTE]

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