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Hi Douglas
I agree with Jose that The MetaStock Enhanced
System Tester is a source of frustration and confusion. I also think that
TradeSim is what you'll eventually migrate to if you continue to use MetaStock.
Having said that, I think it's important for your own development in building
and testing systems that you at least make the effort to find out what the EST
can do, what its limitations are, and how you can navigate around the obstacles
that frustrate many users.
There's an excellent article by Tom Sprunger in the
archives that spells out a number of the EST issues and how to get around them.
I've also addressed some of the issues in a series of articles for MetaStock
Tips & Tools subscribers. With a better understanding of the potential
problems it's not so difficult to avoid most of them.
There's a fundamental flaw in the way the EST tests
systems across a portfolio or database. It essentially focuses on one issue at a
time, and the portfolio result is merely the sum of the results of individual
securities. This is not particularly useful because any system under test
could present far more trades than most traders could possibly take. Therefore,
the success of that system (in real trading) could come down to discretionary
decisions made by the trader as to what trades to take and what ones to
leave.
TradeSim, on the other hand, can test random
entries up to the limit of capital available (Enterprise edition?) and give a
much more objective measurement as to its viability in real life. The
EST will not tell you that a particular system lost money for three
consecutive years on a test over ten years of history. At least it won't tell
you that unless you test your data a number of different ways.
TradeSim can highlight the bad news with virtually no effort on your
part.
Before moving to TradeSim, I think you'd be wise to
at least make yourself familiar with the Trade Equity tools too. These are FREE,
so for zero outlay you're going to learn more about using MetaStock, and you're
going to have an alternative way of inspecting system test results. Trade Equity
processes securities one at a time, just like the EST, and it has far fewer
"bells and whistles". Even so, for the time and effort that it takes to record
one Excel macro you can see aspects of portfolio results that will never stand
out when using the EST. There are additional TE tools available (free to MSTT
subscribers only - sorry) that can plot a portfolio equity curve and the number
of active (non pyramiding) trades at any one time.
To summarize. If you're serious about
building your own profitable systems you'll probably need TradeSim to
complement MetaStock sooner or later. However, abandoning the EST
immediately and moving to TradeSim will probably limit your later
effective use of both MetaStock and TradeSim (IMO). I'd suggest that you become
familiar with the tools you already have at hand before you migrate to new ones.
Developing systems is a process, not an event, and I'm sure that taking a little
extra time along the way will bear fruit further down the track.
Just my thoughts since you asked.
Regards
Roy
----- Original Message -----
Sent: Wednesday, October 26, 2005 10:10 AM
Subject: [EquisMetaStock Group] Re: TradeSim Needed or not
Needed?
Douglas, from my point of view, MetaStock's System Tester
is a
constant source of confusion & frustration. I have avoided
using it
for years.
I use TradeSim (Enterprise Edition with Monte
Carlo testing) for all
my portfolio backtesting tasks, and Roy's Trade
Equity indicators for
instant equity plots on single
charts.
TradeSim:
http://www.compuvision.com.au
Roy's
TE series:
http://www.metastocktips.co.nz/te_formulas.html
jose:
http://www.metastocktools.com
'-)
---
In equismetastock@xxxxxxxxxxxxxxx, "Douglas Morgans"
<douglasjmorgans@xxxx> wrote:
>
> To anyone who wants to
offer an opinion.
>
> I'm building my tool chest around Metastock
and was wondering
> whether TradeSim was a profitable addition for
backtesting.
> Regular edition, Professional Edition?
> Can
Metastocks backtester do an adequate or more than adequate job
> in
helping to define a profitable system?
>
> Both Positive and
Negative opinions would be highly welcome!
>
> I've been reading
post for quite some time and want to thank
> everyone for their
imput. For beginners its a real source of
> information.
>
Thanks!!!
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