Adrian Reid shows how to check if you're actually following your trading system by running a backtest over the last six weeks, listing every signal it produced, then comparing those signals to the trades you actually made and the prices you got. His backtests assume execution at the next open, so match your real open prices against that.
You can then run your backtest today and say, okay, what signals did the backtest give me over the last six weeks? And what, what trades did I actually take? And do they match?
So other trades the same. In hindsight, does the back test actually give me signals in the stocks that I bought? But the second part of that is what price did the backtest interact? And what price did the backtest exit at? And what price did you actually enter at? And did you actually exit at? Because if the back, because the back test assumes you and typically in my systems, the back test assumes you get what price the systems enter at the open. So when, when you run the backtest now and look back at the last six weeks.
The price that the backtest will have in there is the opening price the morning after the signal was generated, right? And so when you're placing your trades, you should be getting the opening price.
So you can compare your price that you got to the opening price that the backtest got and see if there's a difference.
Sam.
