I must admit that I have never really dabbled in penny stocks. Like most, I’m all too aware of the blatant risks trading in smaller cap shares. While there are plenty of legitimate companies, many stocks that trade under one or two dollars are just shells for more dubious operations.
In this article I look at the differences between paid, good quality stock market data and free end-of-day stock data. When designing and building trading systems it is crucial to have reliable and clean end of day stock data. I use Amibroker to chart and back-test trading systems but no matter what platform you use, common sense […]
Designing a trading system is about following the right processes and being conservative in your assumptions. I have already talked about the pitfalls of selection bias and I’ve spoken of the importance of stress-testing a trading system thoroughly. Now I shall answer the question ‘what is slippage’ and how does slippage affect trading system performance.
In order to back-test and optimise a trading system you’ll need at least two things; a back-testing platform like Amibroker, and some historical stock market data. When it comes to historical stock data there are plenty of options available depending on what you want to do. Historical stock market data for Amibroker Amibroker comes with […]
Using Amibroker it is possible to build sophisticated trading systems with just a few lines of code. Complexity is not an important ingredient for a good trading system. The most important thing is to build a system that is based on an edge, some identifiable pattern that you have found in the data itself which […]
I spoke previously about the dangers of survivorship bias and the relevance of start date. I also spoke about the need to keep data out of sample and to keep the number of optimisable parameters as low as possible in order to avoid data mining. As well, I mentioned how the only true out of […]
In my book, I detailed 20 original trading systems and tested those systems on historical stock data going back to the year 2000. Some of those systems produced reasonable results and indicated promise for future trading. Many were able to capture some nice trends like this one in CarMax Inc: However, one back test is […]
People often want to know whether forex trading is profitable. They see a strategy online promising 1000% returns and millions of dollars in profits and wonder whether they too can become successful forex traders. On the flip side, though, they will also have heard the stories of those traders who have lost money and in […]
In this post I will show how to build a quick trading system for the Nifty, the Indian stock exchange, using Amibroker. The purpose of this isn’t to provide a working trading system but to illustrate how easily it can be done. The video here proves just how quick the process can be. Building a […]
The term ‘quant’ or ‘quantitative trading system’ conjures up the image of a smart math graduate on the desk of an investment bank who spends their time creating sophisticated short-term algorithms. Such algorithms that pull millions of dollars from the market in a blink of an eye. However, and though there are many of these […]
The Amibroker trading platform is extremely fast, flexible and is excellent value for money. I’ve been using the software since 2011 and my Amibroker AFL collection has grown considerably in that time. Whether you’re interested in building trading systems, trading long term trends, or simply doing technical analysis, you’ll be able to do that and […]