Line Your Own Pockets

In this week's episode of Line Your Own Pockets, we answer a multi-part question from long-time list member Chip D.S. (name used with permission).
The first part of his excellent question:
Do you typically optimize longs and shorts separately. assuming there are enough trades after the split.  You have a couple newsletter articles that mention "directional" columns...so there must be situations where you think optimizing them together is best?We discuss:
Why optimizing separately is a good default, but not a set-in-stone rule
Look for commonalities when optimizing the long versus the short trade sets
How "directional" columns are useful when combining long and short trade sets
When going live with an Amibroker strategy, how to strip down the code to make it run fast
And much more...

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Before you go!
The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.
I hope to see you there!

We interview Steve Bravo from Massive (formerly known as Polygon.io).
I passed along several questions from MabeKit Mastermind members, who brought up some good ones.
We discuss:
Why there are so many data providers and what makes Massive unique
Why the name change? (They changed from Polygon to Massive several months ago)
How AI has changed the data business - dramatically
Discrepancies between data vendors and what causes them
What's coming next from Massive? (L2, fundamentals, etc)
And much more...
Thanks to Steve for joining us!

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Before you go!
The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.
I hope to see you there!

In this week's episode of Line Your Own Pockets, we discuss a question I received from a reader named Sridhar.
He recently went live with 8 automated trading strategies - and none of them are performing well.
In his words (used with permission, excerpted for clarity):
Sridhar:
Hi Dave, I'm struggling at the moment, and you're the person whose judgement I trust most on this.
In less than 2 months, I found up to 8 intraday strategies, each with >1.5 PF, each researched to a locked backtest.
The results don't match the effort. I'm down about $16.8k net of commissions since mid-July, and I've been red on 22 of 35 trading days.
I hope things can turn around, but honestly, I'm losing spirit a bit. The process and the engineering are strong, and I'm still losing money. I'd really value your perspective.
We discuss this in detail in this episode, with concrete steps to improve and identify the mistakes.
Topics include:
Start with 1-2 strategies rather than 8
Trade tiny at first - you can learn a lot with minuscule size, so you can avoid "paying tuition" to the market
How to plan for drawdowns before they happen
Don't "build the pedestal" - use established backtesting software and focus on the important thing: the strategies
Only scale after the market has given you concrete feedback that your process is sound
And much more...

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Before you go!
The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.
I hope to see you there!

In this week's episode of Line Your Own Pockets, Michael and I have a heated discussion on swing trading versus day trading.
It starts innocently enough with a question about how to backtest a swing trading strategy with a "trail forever" component.
But then it quickly turns into a swing trading versus day trading cage match.
We do finally end up agreeing on the fundamental approach to backtesting a swing trading strategy - barely.

Topics discussed:
The differences between backtesting a day trading and a swing trading strategy
Open-ended trailing exits make backtesting more complicated, and how to handle this in your test
How outliers can affect your backtest and how the trailing-exit component can magnify them
Overlapping positions suck up buying power, creating an overnight choke-point
And much more...

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Before you go!
The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.
I hope to see you there!