Product / Product Information / Neural Nets
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Model-Based Strategies
To test a model, Tradecision applies a simple model-based strategy
to historical data and determines whether you would
have made a profit if you had followed this strategy,
or not. If the strategy turns out to have been profitable, and
if it fits your trading personality, you can be confident in
using the model to make future trading decisions.
A major advantage of model testing using a model-based trading
strategy is the possibility to rigorously test the model
over different periods of time and with different parameters.
To help you thoroughly analyze a model-based strategy, Tradecision
creates the Strategy Performance Report. The
report provides detailed information about your strategy, including
the return on account, drawdowns, risk ratios, number of profitable/losing/outlier
trades, as well as timing analysis. To ensure that the figures
of the Strategy Performance Report are as close to reality as
possible, you can factor in broker's commissions
and slippage.
For better performance, your strategy parameters can be optimized
using Genetic Algorithms (GA) or exhaustive
search. Visit the Trading
Systems page for more details about strategy optimization.
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