My Back-testing Offer to Anyone

Creating good, non-discretionary, trading systems isn’t easy, because computers will do exactly what you tell them to do, instead of what an experienced, market-savvy trader might have done instead. If you’ve never written even simple code, but have a rule set that seems like a good idea and would like to test it, then tell me what the rules are using this format (as an example):

BUY when Wm%(14) crosses -80.00 from below. SELL when Wm% crosses -20.0 from above.

There can be more rules than one (which become a set of conditions that have to be met).

What you’re going to find is that Buy & Hold isn’t as bad an investing method as traders accuse it of being. (E.g., I tried to beat what B&H offered for MCD over various holding-periods and couldn’t.) But it’s better to do one’s buying when stocks aren’t over-priced, which is the other half of the investing program that the B&H crowd conveniently forgets.

Where “trading” can hold its own --and even offer superior results – is in “rolling” markets. So finding a decent rule set is only half the problem. Finding good trading candidates is equally important. And trumping them all is risk-management. If you over-bet your hand too many times, you get throw out of the game permanently.

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