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watchmenow
8
watchmenow 2016.10.13 17:25 

The most interesting figures at the Strategy Tester Report are imho Total net result and Relative drawdown. Both figures will be greatly dependant on the choosen Order size. Another valid statement is that the rate between Order size and Account balance together with the Relative drawdown will determine if your account will stay alive on the long term. If you take as fundamental idea that you want to get the most out of your Account balance you must increase the Order size, but how far can you go without ruining your account? That's where you need an additional figure: Efficiency. If you divide the Total net result by the Relative drawdown you will get the Efficiency figure that tells you indirectly how far you can go increasing the Order Size. I.e. suppose after backtesting a certain Indicator over a year on an account with a balance of $10.000 you will get a result of $10.000 and a Relative drawdown of 10%. The efficiency will then be 10.000 / 10 = 1.000 and I can tell you that's very good! With that figure you can safely increase the Order size. Ofcourse you must learn to interpret the Efficiency figure by comparing the results between different Indicators and/or Indexes/Forex pairs and you will see how they can differ.

It would be great if Metaquotes would consider to add such an Efficiency figure to the Strategy Tester Report, so I hope they read this idea. It would at least save me a lot of calculating... 

Fernando Carreiro
1554
Fernando Carreiro 2016.10.13 19:39  
watchmenow:

The most interesting figures at the Strategy Tester Report are imho Total net result and Relative drawdown. Both figures will be greatly dependant on the choosen Order size. Another valid statement is that the rate between Order size and Account balance together with the Relative drawdown will determine if your account will stay alive on the long term. If you take as fundamental idea that you want to get the most out of your Account balance you must increase the Order size, but how far can you go without ruining your account? That's where you need an additional figure: Efficiency. If you divide the Total net result by the Relative drawdown you will get the Efficiency figure that tells you indirectly how far you can go increasing the Order Size. I.e. suppose after backtesting a certain Indicator over a year on an account with a balance of $10.000 you will get a result of $10.000 and a Relative drawdown of 10%. The efficiency will then be 10.000 / 10 = 1.000 and I can tell you that's very good! With that figure you can safely increase the Order size. Ofcourse you must learn to interpret the Efficiency figure by comparing the results between different Indicators and/or Indexes/Forex pairs and you will see how they can differ.

It would be great if Metaquotes would consider to add such an Efficiency figure to the Strategy Tester Report, so I hope they read this idea. It would at least save me a lot of calculating... 

That (similar metric) already exists in MT5 and it is called "Recovery Factor". In MT4 however, you can easily accomplish this in the EA, by calculating it using TesterStatistics() values and returning the result via OnTester() .

I also suggest you do some extra research into other metrics, as there are others just as important (if not more) than just profit and draw-down, such as for example "Profit Factor"!

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