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Strategy tests are a good way to get started.
But you also need to get used to the everyday trading experience. Most of the time, bad problems occur at the very worst time and several unexpected things come together.
The idea is to stick to the trading rules and not to do something stupid. The idea is to minimize the risk and make a profit. One key for a profitable system is the ability to have several positions for the same currency pair. When I change something for my trading system, I am going through a whole series of tests to find out what works and why it works. One thing that is very helpful to improve trading results are good statistics. The trading software comes with a few statistic tools that are not bad. But for really sophisticated insight, you need more. Driving on icy roads is a much higher risk than losing a few hundred dollars on a small account. But one situation can cost you good night’s sleep, while you might not even notice the risk of your daily commute. Every trader has his preferences and things he doesn’t like. Often these things are results of past experiences. Errors are not avoidable. But I learned from my errors and now I avoid bad brokers. We all are happy when something is going better than expected. But what is with the bad surprises? Most people think that they would be very happy to make a few thousand dollars, and that might be true.
But the real problem is that they are not willing to lose even $100 to make a few thousand dollars. You can’t expect to get good at anything right away. It takes years to learn to speak a language and it also took years to learn how to read and write. You might see the end result and think that this is indeed a good outcome. But most people will never see something like this because they stop their system in the middle of the first drawdown.
A good recipe is a good way to get the result you want.
A good recipe is easy to follow and a good recipe has all the parts you need for a good outcome. Whenever I build a new kind of trading system, I trade at least ten years of data for at least ten different currency pairs to see if it is a good system. Other people like to trade huge position sizes.
They like to say that they have doubled their account in two weeks or so. Too risky for me. I think that the best possible way to improve trading results is to do a lot of tests. While most people focus on the entry signal, it is more about what you do after the position is opened. If you find yourself in front of your screen hoping that something will become a profit, that is not a good strategy. All we can expect is a probability that is higher than average. But it is still possible to ruin a system even when you are right most of the time. I do a lot of tests, usually for at least ten currency pairs. And if I am convinced that I found a market advantage, I turn the whole thing around and trade the opposite.