Once the strategy has been developed and the eligible sample data is obtained, the next step is to test whether the strategy is feasible. Regardless of the strategy, what needs to be tested is whether there is revenue around the stage of buying to selling (of course, it may be the stage of selling first and then buying, which usually happens in futures trading).
If the trader relies on manual calculation of the trading process at this time, there will be a problem of "calculation is accurate". This is because when a trader is faced with a large amount of data, it is inevitable that misreading numbers, misplaced decimal points, missing calculations, and improper use of arithmetic rules. For the operation of a large amount of data, the most appropriate method is to complete the computer, which not only ensures the reliability of the data calculation, but also can be quickly calculated by the fast tuning of the strategy.
Testing data through computers presents another problem for traders: they need to be proficient in software that can calculate large amounts of data.
Individual traders generally do not use very specialized software such as databases when processing data because this type of software is too complex and difficult to master for individual traders. The corresponding spreadsheet software is the most suitable tool for personal traders to analyze data. For example, Excel, Numbers and Calc are all spreadsheet software.
In addition to being familiar with the operation of the software, traders need to be familiar with basic arithmetic rules and some logical judgment rules in order to automate the analysis and processing of sample data.
For example, a strategy: when the price-earnings ratio is between 15 and 25 and the MACD is greater than 0, it is bought. Such a sentence may be expressed in a spreadsheet similar to the following:
"PE between 15 and 25" AND "MACD>0"
Let's take a look at the inspection process through an example.
(to be continued)
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Philosophical thinking of financial transactions
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