how long for study the signals of a strument?

Davide Tedesco
206
Davide Tedesco  
Hi at all,

After we develop basic of a strument, for to detect and analize
the signals, how long to study it on historical data ? or on real data?
1 month ? 1 year ? 3 years ? ...more?

I think the correct study period is relative to period we want use this strument,
for example: if we want develop a profitable strument to use for 1 year,
we must study and analize results of this strument, at least,
on 1 year of historical data.

So, how long you analize results of a strument? and for how long you want use it ?

Thanks everyone in advance
Carl Schreiber
Moderator
11432
Carl Schreiber  

My answer would be that time don't really matters. Some look at a picture for hours and don't understand it while others can see everything only by a short glance.

Study your program in different situation and try to understand its behaviour so that you can estimate it's risk and chances:

  1. during a trend - is it making money?
  2. in a flat market - is it loosing money?
  3. the behaviour if flat becomes a trend - is it too late (or too early) catching the trend?
  4. if a trend flattens  - is it too long 'thinking' it's still a trend?
  5. what if the trend heavily changes up and down - is it fast or too slow and therefore summing up losses?
These are my two cent and I hope your program brings you much more than that :)
Muhammad Syamil Bin Abdullah
1396
Muhammad Syamil Bin Abdullah  

Based off my experience at least 1 year. Your signal study based instrument must take into consideration on various factor:

1) Your signal work best on which instrument, on various market behaviour, conditions and volatility;

2) Which timeframe to be used;

3) The risk reward ratio, return of profits, loss rate;

Good luck in your research!

Azalea_turner
9
Azalea_turner  
Davide Tedesco:
Hi at all,

After we develop basic of a strument, for to detect and analize
the signals, how long to study it on historical data ? or on real data?
1 month ? 1 year ? 3 years ? ...more?

I think the correct study period is relative to period we want use this strument,
for example: if we want develop a profitable strument to use for 1 year,
we must study and analize results of this strument, at least,
on 1 year of historical data.

So, how long you analize results of a strument? and for how long you want use it ?

Thanks everyone in advance

Hi. I believe time is relative and it varies from person to person. Based on your learning and trading styles, you need to consider few factors. For me, I take account of the following issues:

1) The best time frame, the time frame where you can achieve the most profits. I usually trade between 3pm and 12 am EST.

2) The estimation whether I will gain profits or losses in a trade. I mainly pay attention whether I am profitting when there is an upwards trend. I also examine whether I am at a loss when the market is flat

3) I also determine how much profits I am gaining and how many losses I faced. If the money I lost altogether is more than the money I gained in a month, it means I need to stop and try out a new strategy or I will bleed out dry.

4) I usually try to stay on the safe side and stop my trade when I notice the trade fluctuating very quickly. I usually exit when the trend is in my favour, stop order basically. 


Hope this helps :)

Davide Tedesco
206
Davide Tedesco  
very intersting !!
There are very interesting points for analize my strategy.

Currently, i am trying to finish and refining a full loop of my current analysis model, so some points are useful for me now, some after.