Adrian Reid shows how to test a trading system the right way: propose a specific idea like buying a 200-day breakout with a 25% trailing stop, validate it on old data, then test it forward on new data before trading it live.
all I'm doing is saying, oh, I have a system idea, let me try it on this ticker. And I'm doing the whole process. This is exactly the same as if you thought, oh, I wonder if buying a 200-day breakout and selling on a 25% trailing stop works. Let's apply that to Australian stocks. I'll only take up until 2018 as my in-sample. I'll split it, the in-sample period in 50% into an in-sample and out-of-sample kind of ticker watch list. I'll run the whole process and then I'll do an in-sample, out-of-sample test., and if it passes, then I'll trade it. If you want more trading tips from Enlightened Stock Trading, make sure you give this video a like and follow Enlightened Stock Trading so you don't miss the next video. And go to enlightenedstocktrading.com/free to get your free Trader Acceleration Bundle to start improving your trading results today.
