User Tools

Site Tools


backtest_a_trading_system

How to Backtest a Trading System

Step 1: Open the Backtest Assistant

In the sidebar, under BACKTESTS, click Create new backtest….

Step 2: Select the Trading System to Backtest

Click Next to go to Trading system selection.

In the left part, select the trading system to backtest.

Step 3: Set the Parameters

Click Next to go to Parameters of trading system and virtual account.

You can set the following trading system parameters:

  • PositionSize: the default number of shares to buy or sell.
  • StopLoss: the default loss level at which to automatically exit the position.
  • TrailingStop: the default draw-down level at which to automatically exit the position.
  • TakeProfit: the default profit level at which to automatically exit the position.
  • MostSimultaneousPositions: the maximum number of positions that can be opened at any time.

You can set the following account parameters:

  • Initial Equity: the equity at the start of the backtest.
  • Maximum leverage: the leverage the trading system can use to enter positions.
  • Margin requirements (%): the level at which a margin call will be sent.1)
  • Commission: the fixed commission for each trade, in currency units.
  • Commission (%): the commission for each trade, in % of amount invested.

Step 4: Select the Historical Data

Click Next to go to Historical data selection.

The sidebar on the left, and the list-view in the middle allow you to browse stock tickers. To use tickers for the backtest, you can either drag them individually onto the right part of the page, or use the Add All button.

Use the date controls at the bottom to set the date of start and end of the backtest.

Step 5: Launch the backtest

Click Launch Simulation.

If additional ticker data is needed, it is downloaded automatically. Then the backtest is performed.

1) This parameter is divided by Maximum leverage: if the value is 50% and the Maximum leverage is 4, the actual requirement is 12.5%.
backtest_a_trading_system.txt · Last modified: 2014/08/02 06:29 (external edit)