Hello Gulu
Nice thread . . . :thumb:
I have started trading a system based on daily TF which was back tested on 41/2 years of data
and coincidentally it gave me just 67 trades from back testing . . .
Regarding the sample size for the number of trades I feel the figure 100/or whatever is not so much relevant,
perhaps the more important factor would be to ask, have we covered maximum number of different scenarios that can occur . . .
Ideally we should be saying all possible scenarios,
but then there is no way to define this illusive all possible
With my back test, my view was 67 is a v small sample size.
When I did a bar by bar walk-though I was trying to look at different possibilities for what ifs.
Putting the system through the rigor of testing for all known/imaginable what if scenarios, and
walking through the entire know history of the ticker made me feel better but still there was
this lingering thingy, before taking it live, about should have had more back-data for testing.
Looking forward to your trade list and other posts detailing various aspects of evaluating the performance of our trading systems.
One aspect that you have touched upon is about curve fitting the system to the past data.
They say for avoiding or minimizing this one needs to keep the degree of freedom to minimum.
i.e keep to minimum the number of variables that are used in decision making
Not sure how we can truly achieve this? Maybe you can also say more about it.
One again thanks for the thread.
Happy