One of the key steps in testing a trading system is to actually write down what you are testing.
You want to do this for a few reasons:
- So you remain constant in what you are testing throughout the test. It is easy to “bend” the rules of your system during the test because you may see something that might work better. In order to get an accurate test of a trading method, you have to stick to the rules during the whole test period.
- If you need help verifying your testing results, you need to be able to give the exact parameters of the system to another person.
- Once you start testing a lot of similar methods or different versions of a method, they will all start to look the same and you need to have a way to match up your results with the parameters you used.
- If you actually start forward testing it or it even gets to the point of trading real money, you want to have a document that you can reference from time to time so you don' break the rules.
These are all problems that I ran into myself and I wanted to create a solution. So I put together this easy-to-use template that will allow you to map out your ideas for a trading strategy before you get started testing.
The best way to use it is to print out a bunch of these templates and have them near your computer. When you come up with an idea for a strategy, fill out the form and keep it in front of your computer while you are testing. As you are testing, jot down your ideas on the form so you do not forget.
There is no cost to download. It is my way of saying thanks for following this blog.
If you have any suggestions for improvement, feel free to contact me and let me know.