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Loss Aversion

Free Backtesting and Optimization Education and Tutorials Video Series

Does Free Backtesting Education really exist? Is it any good? Do I need to spend hours sifting through uninsightful videos to find what to focus on?

In short, no. Today’s video gets straight to the point and highlights the most insightful content in the Backtesting and optimization playlist.

Like the previous video, which focused on algo trading for a living, today’s focus is on

Backtesting and optimization.

Episodes 1 & 2. This mini-series made up of 8 videos shines a light on how to extract the best parameters from your backtest to implement in your live trading. This is no easy task, hence the length and detail of information in this mini-series.

Episodes 3 – 6 consist of 11 videos and covers the critical topic of over-fitting. When looking at your backtest results, it’s important not to cherry-pick the one with the greatest return. Over-fitting your backtest to historical data is dangerous, as this part of the series covers this in great detail.

Episode 7 delves into the world of Walk Forward Optimisation. Walk Forward Optimization is a way of optimizing parameter selection without overfitting. This is thoroughly recommended viewing.

Episodes 8 & 9 expand on lessons learnt in episode 7 and build on this by getting to the heart of the optimization process. It does this by looking at, amongst other things, compelling optimization profiles. This is important because it highlights how to deal with unpredictable results and outliers.

Episode 10 covers performance metrics and how to use these metrics to increase your backtests robustness further and, as such, improve your live results.

Then, episode 11 analyses price data models used in backtesting processes. This episode helps select the most appropriate settings to use in Backtesting. These should closely resemble that of live trading.

If you were to use wildly different price data, your backtest would not be a fair representation of what you can expect to see in live trading.

The remaining 13 videos help tie all the above together. By the end of this video series, you will have a deep and powerful insight into some best practice techniques for handling price data, selecting parameters and optimizing your strategy ready for live trading.

Monitoring your live strategy

Additionally, you can monitor the performance of your trading strategy by using some of the Darwinex Investible attributes and performance metrics.

If you look at the Open Strategy (Os) & close Strategy (Cs) Investible attributes, these rate the performance of your strategies opening/closing trades compared to if it opened/closed earlier or later.

You could use this information to see if the market has changed and if the edge you researched previously still holds up, or if it has started to decay.

The Darwinex platform has a wealth of tools to help the trader and investor alike. Feel free to have a play, and if you need further clarification on anything on the Darwinex platform, don’t hesitate to get in touch.

Brought to you by Darwinex: UK FCA Regulated Broker, Asset Manager & Trader Exchange where Traders can legally attract Investor Capital and charge Performance Fees.

Risk disclosure:

https://www.darwinex.com/legal/risk-disclaimer

Content Disclaimer: The contents of this video (and all other videos by the presenter) are for educational purposes only, and are not to be construed as financial and/or investment advice.

Free Algo Trading Review

Free Algo Trading Review of Education and Tutorials Video Series

In this Algo trading review, it’s time to take a look back at the last year. There is much helpful content in the Darwinex YouTube channel, and who better than Martin to cherry-pick some of the most insightful pieces of content for you regarding Algo Trading. 

This article intends to highlight the key points from the Algo trading for a living video series. 

So let’s begin this Algo Trading Review.

In Episode 3 & 4, Martyn shows us the importance of being multi-skilled. There are numerous disciplines you need to be competent in to be a successful Algo Trader. These videos cover essential topics such as

  • The importance of not over-leveraging.
  • How not to over-complicate your trading strategy
  • Getting your data feed in order
  • How best to maintain your trading strategy for optimal performance

Trading isn’t easy; it’s actually very hard. 

As Tom Hanks said, “It’s supposed to be hard. If it were easy, everyone would do it.”

Although Tom wasn’t talking about Algo Trading, it most certainly applies. But this difficulty is what makes it so rewarding when it does work. 

Episode 5 talks about developing an Algo Trading System and is one of the most beneficial videos in this Algo Trading Review. This episode covers the core concepts of how to structure the creation of a Trading idea.

Get this step wrong, and everything downstream will be more complicated than it needs to be. That’s why taking an incremental agile approach can be so beneficial.

One topic that seems to be misunderstood a lot in Algo Trading and hence its inclusion in this Algo Trading Review is Psychology. Episode 7 covers this brilliantly.

Two scientists came up with an observation and named it the Dunning-Kruger effect. This theory forms the foundation of the idea and is entirely relevant, which is why we’ve included it in this Algo Trading Review.

The following 20 videos form their own mini-series—the topic. 

The best practice use of indicators.

This mini-series dives into the most optimal use of a variety of different indicators. Often indicators are misused and abused and, as such, can provide negative results.

However, if you correctly implement these indicators, the rewards can be astounding.

Episodes 9 to 28 aim to do precisely that. If you use indicators in your trading, then watching and rewatching this mini-series will hopefully provide you with some fantastic insights into best practice use of the indicators available to you as an Algo Trader.

Then to keep you on your toes, Martyn moved away from Indicators and over to a higher level idea. 

Portfolio Diversification and Correlation.

There are Fifteen videos covering a host of topics to do with reducing the overall risk on your portfolio. In addition, this mini-series on portfolio diversification and correlation covers four diversification techniques which are

1. Across asset classes

2. Within an asset class

3. Across different timeframes

4. Using different trading strategies

You can apply these techniques to any portfolio, whether you are an active trader trading forex CFDs or a passive investor who invests in stocks, ETFs, Darwins or every variation in between.

Episode 41 is incredibly beneficial, providing you with a correlation heatmap of 40 assets, all tradeable on the Darwinex platform. 

Brought to you by Darwinex: UK FCA Regulated Broker, Asset Manager & Trader Exchange where Traders can legally attract Investor Capital and charge Performance Fees.

Risk disclosure:
https://www.darwinex.com/legal/risk-disclaimer


Content Disclaimer: The contents of this video (and all other videos by the presenter) are for educational purposes only, and are not to be construed as financial and/or investment advice.