Testing Gives You Emotional Strength for the Fu*$#*g Hard Times
June 6th, 2009
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Once you’ve learned enough about trading systems to pick one that you like, the most important thing you can do to deepen your belief in the system is to back-test it against various sets of historical data for various markets.
If you do a good job of testing, (press a button and go to sleep) so that you know that your system is strong and robust enough to survive (and be profitable) in a wide variety of past market situations (credit-crunch for example), then you will have more belief in it’s behavior and abilities in future markets, during Fu*$#*g horrendous and probable draw downs.
Categories: Backtesting