What is considered "good" in a trading strategy?

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Quint Boney
759
Quint Boney  

This may sound like a stupid question, but what is the definition of a good strategy?

The ultimate fantasy would be a strategy trades at a massive Profit Factor, with almost 0 drawdown, that has many trades, and works on all Forex pairs on multiple timeframes.

But is that realistic? I have found strategies that work great on one pair, only to flop massively on another pair. Is testing on data from 1980 and 2019 the same?


Are there experienced Forex traders here that can comment on how often, if ever, they changes strategies?

Fabio Cavalloni
2999
Fabio Cavalloni  
Quint Boney:

This may sound like a stupid question, but what is the definition of a good strategy?

The ultimate fantasy would be a strategy trades at a massive Profit Factor, with almost 0 drawdown, that has many trades, and works on all Forex pairs on multiple timeframes.

But is that realistic? I have found strategies that work great on one pair, only to flop massively on another pair. Is testing on data from 1980 and 2019 the same?


Are there experienced Forex traders here that can comment on how often, if ever, they changes strategies?

Good strategies are strategies that can earn good profits without suffering big drawdowns.

For this reason, profit factor and drawdown from strategy tester are useless values because you don't see the most important thing: floating equity and distance between balance and equity.

An EA that closes only trades in profit will have a very good profit factor (nearly +infinite) but it pretend to close only profit trades, leaving loosing ones opened for undefinied time (generating big drawdown and burning accounts).

Usually a good strategy can perform well on different forex pairs, except particular conditions (EA that trades inefficiency founds only on a SPECIFIC currency, for a SPECIFIC reason.)

If you have an EA that trades with 2 moving averages and performs well (for example) only on EURUSD H4 from 2010 to 2019, this will not be a good strategy but only a statistical force of your strategy, that you found peforming well only in a particular scenario that cannot be replicated in the future, of course.

At the end, strategies need to be continously studied and improved, and also leaved alone when they stopped to work as expected, for this reason there will be not Holy grail EA but only some EA that can perform well in a particular scenario and particular time period.

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