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Trading Systems: Expert Advisors Based on Popular Trading Systems and Alchemy of Trading Robot Optimization (Cont.)

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New article Expert Advisors Based on Popular Trading Systems and Alchemy of Trading Robot Optimization (Cont.) has been published:

In this article the author continues to analyze implementation algorithms of simplest trading systems and describes some relevant details of using optimization results. The article will be useful for beginning traders and EA writers.

Optimization of trading systems is widely discussed in various literature and it would be illogical to write here in details what can be easily found in the Internet. So here we will discuss in details only fundamental simple ideas underlying the logics of understanding the point of using the results of automated systems optimization generally and the practical usefulness of optimization particularly.

I suppose you know that it is easy to upload into a strategy tester an Expert Advisor constructed on the basis of even a relatively simple trading system, after its optimization you can get amazing testing results almost on any historic data that coincide with historic data of optimization. But here a natural question occurs: "What does the result have to do with the forecasting of an automated system behavior, even if the result is tremendous but has been achieved after adjusting the system according to history?"

At the moment this question is rather acute. One of the reasons for this is that after first successful optimizations, a beginning EA writer can get the wrong idea about a thoughtless use of optimization results in live trading and the consequences of it can be damaging. And the beginning EA writers can loose their own money or the money of those who will use the ready Expert Advisor. So I will start my article with this topic.

Author: Nikolay Kositsin

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