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>I seem to be able to create great formulas with good test results for
>a particular share, but when I test it on others, it's no good - so
>my question is this - Is it worth creating a list of formulas,
>matching them to particular stocks, and then working with just them,
>and waiting till they give buy signals for their shares only??
I would say the short answer to this question is "no". What you seem to be
describing is known as "curve fitting." In otherwords, you are over
optimizing you system so that it works really well on historical data for
one stock. The problem is it doesn't work on other data sets; either other
stocks or or the optimized stock in the future.
An idealized view of technical analysis holds that a "good" system will work
on any tradable (stock, bond, currency, whatever). In my experience, this
ideal view is hard to come by even across stocks, but, you want to develop a
system that works across a variety of stocks using parameters that give at
least reasonable results on all of them.
The new version of Metastock allows testing and optimization across multiple
stocks and that is what you should be looking towards. I have been working
on systems that trade the Dow 30 stocks. There are a couple of books out
there on system development that I can recommend;
One is something like "Design, Optimization and Testing of Trading Systems"
by Robert Pardo and the other is something like "Trading Systems" by Perry
Kaufman.
If someone has a strategy they use to take advantage of Metastocks
"comparison testing" feature, I am interested in learning about it.
Thanks, Dan
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