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Market Conditions and How They Matter in Backtesting

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Many people are rightly skeptical of backtesting. I recently gave a webinar on using automated backtesting as a tool for improving expected returns. Afterwards I received an email from a trader who had only seen part of my presentation and apparently got the wrong impression. To his ears, I was promoting backtesting with historical data as a panacea, as if to say, "optimize your trading plan over past data, and you are assured of future profits." I assured him that this was not the case. To … [Read more...]

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QuantyCarlo Tutorials Are On Their Way

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The QuantyCarlo tutorials are on their way, and what better place to start but the middle? Actually I could just as well have chosen the System Overview as the first tutorial to upload, but instead I chose the Overview of Symbolic Expressions. So-called “symbolic expressions” are the building blocks of trade logic in QuantyCarlo. Not every user will want to create their own symbolic expressions. In fact, we’ve created the "Easy Entry” page for those seeking instant gratification. Also, … [Read more...]

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IOTA Option Trading Optimization Methodology

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Option trade optimization is a multi-step process leading to enhanced returns (profits or similar metrics) combined with reduced risk. Both returns and risk can be measured in several ways: return may be expressed in absolute dollars or as a percentage of some other metric, such as amount invested or risked. Likewise, risk may be measured by size, frequency or total of losses. However measured, (which is decided by the trader), optimization does not entail achieving the highest possible … [Read more...]