Monthly Archives: August 2017

Aug 29

Simulation: Beyond Backtesting

Graybox Trading

One problem with traditional backtesting is that it relies on the presupposition that there are repeating predictive patterns in the market. In fact, most trading methodologies rely on this assumption. And  yet, we know the disclaimer that past performance is not indicative of future results. And, yet backtesting largely assumes that the future will be […]

Continue reading
Aug 12

Beyond a Trading Plan

Trader's Mindset

Beginners are taught the importance of developing a trading plan. The problem with a trading plan is that most trading plans will read like a wish-list. They are not likely to be based on facts or empirical evidence. Example of a well-intentioned but poor trading plan: My plan is to trade the ES using tape […]

Continue reading