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LIZ MERRILL wrote:
>
> Has anyone purchased the Pulse Directional System at the url below:
>
> http://www.callnetuk.com/home/tradingsystems/
>
> I am seriously considering purchasing it in the next few days. The
> cost is $200, and the Tradestation PL looks fantastic. If anyone out
> there has bought it, please email me with your impressions. Thanks.
>
> Liz
Their tradestation report has the infamous 0 bars in trade. This means
that they tested the daytrading system on *daily* data and the results
are almost meaningless!
If one tests a daytrading system on daily data, TS has no way of knowing
what the path of the prices were during the day, between high and low.
More importantly, it has no way of knowing if the stop or the profit
target were hit first!!
As i understand it (and I'm no expert) TS makes 2 assumptions. If the
close is higher than the open then the prices progressed from open to
low to high to close. If C<O then the prices progressed from open to
low to high to close. Also there is a function ("bouncing ticks) which
will stop you out if you put your stop less than some % of the entry bar
range (maybe 10%).
Unless you are testing with tick data, TS *has* to make some assumption
about what happened inside the individual bars. If your trade lasts
quite a few bars then the level of these approximations may be small and
reasonable, and average out over many trades. The approximations
weren't intended to let you test a daytrading system on daily bars
however!! It appears that is what these people have done. In this case
the approximations are extremely crude, and the results mean very
little.
There are those who feel that TS should have been programmed to prevent
the tester from doing something like this. However, you feel about TS,
the fact that this vendor tested a daytrading system with *daily* data
shows that either he has something to hide or he doesnt' have intraday
data. If the latter, do you really want to buy a daytrading system from
someone who doesn't even have intraday data??
Conrad Bowers
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