|
PureBytes Links
Trading Reference Links
|
On 10 Dec 2007 at 5:49, Mark Johnson wrote:
> This testing software says that the base systems WITHOUT
> SCALING OUT have approx 40% winning trades. When I enable
> scaling out, wining percentage jumps to about 75%. It's
> not economically significant but I do find it intriguing
> nevertheless.
Not too surprising, since you're basically inflating your win rate. If a trade
immediately goes sour, I assume you count that as one loss. But if a trade is
successful, you count it as 4 wins. So if you looked at 100 trades, formerly
you got 40 wins and 60 losses for 40% wins. If each winning trade is
counted as 4 wins, then you've got 4*40 wins and 60 losses, for a win rate of
4*40 / (4*40 + 60) = 72.7%. That's assuming the losing trades never hit any
profit targets. If any of them do, that will push the win% a bit higher.
If you counted a losing trade as 4 losses instead of 1, then your win%
wouldn't change much.
Gary
|