no problem with the TP level being set. Good idea given that
profit moves to 10% in many cases but as seen in recent trades,
this can be given back
If we now have a series of 6 trades which only make it to a
9% profit before giving this back then I would not expect the
dynamics of the strategy to change such as to move this TP to 9%
with a rerun of historical results to show what 9% would have
delivered
Otherwise, yes good system and no problem with a TP provided its
not regularly adjusted as per the above example
Your 9% example would be true if the series of 9% profit trades
were purely random. If, however, the market had changed and a
9% TP consistently (say over several months) provided better
returns, then it would be a wise choice to change the system to a
9% TP. My assumption is that some market changes aren't day
to day random, but persist over several months. One way to
test this hypothesis with with walk forward optimization.
no problem with the TP
Improved GDX swing system and statistics
Posted by vimal on 29th of Jul 2010 at 07:58 am
no problem with the TP level being set. Good idea given that profit moves to 10% in many cases but as seen in recent trades, this can be given back
If we now have a series of 6 trades which only make it to a 9% profit before giving this back then I would not expect the dynamics of the strategy to change such as to move this TP to 9% with a rerun of historical results to show what 9% would have delivered
Otherwise, yes good system and no problem with a TP provided its not regularly adjusted as per the above example
Vimal, Your 9% example would be
Posted by algyros on 29th of Jul 2010 at 08:46 am
Vimal,
Your 9% example would be true if the series of 9% profit trades were purely random. If, however, the market had changed and a 9% TP consistently (say over several months) provided better returns, then it would be a wise choice to change the system to a 9% TP. My assumption is that some market changes aren't day to day random, but persist over several months. One way to test this hypothesis with with walk forward optimization.
vimal -- I see what
Posted by Michael on 29th of Jul 2010 at 08:10 am
vimal -- I see what you're saying.