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Important Tradingsystem-Parameter
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Invested capital (start capital)
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This reference number shows your capital which you have at the free possession and have invested in a position.
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Net profit (absolutely) corresponds to the final capital
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Start-Capital - This parameter expresses how much money has gained with a tradingsystem. The trading fees and a possible spread should be considered as well (difference of purchase and selling price at one time).
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Net profit / year
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This reference number expresses how much money has gained with a tradingsystem per year.
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Net profit %
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Your profit in % (in relation to the used capital)
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Net profit % / year
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Your profit in % per year (should lie with at least on average 15%) considered more than at least 10 years.
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Net profit (absolutely) / DrawDown
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This reference number is one of the most important parameters for the evaluation of a Tradingsystem. The higher this value is, the better this is. It puts the profit to the taken risk in the relation.
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Profitfactor
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Relation of the trading results all profit to the loss-trades. Successful tradingsystems should show a value of at least 2.5. One of the most important reference numbers for the evaluation of tradingystems.
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Time in the market (TIM)
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Specifies in % how long your system is invested. 50% means that your tradingsyytem within the whole analysis period is invested in half of the time in the market.
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Total number of the Trades (Trading frequence)
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The total number of the Trades should not be too high, because fees per trade accumulate and stockbroker would like to trade not too often. But also for this reference number is valid that she/it should be tuned to your personal profile.
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Number Loss-Trades
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Number of the Trades with a loss.
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Number Winner-Trades
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Number of the Trades with a profit.
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Percentage of profitable Trades (Hit rate)
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Relation of the number of profit to loss-Trades. Successful tradingsystems can also show a value smaller than 50%. This parameter is often overrated.
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The biggest winning trade
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The highest absolute profit of all the Trades.
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The biggest losing trade
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The highest absolute loss of all the Trades.
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The biggest winner to the biggest loser ratio
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The reference number presents for a considered period, the biggest loser or winner in each case. They should have no bigger outliers in any direction. Their profits / losses should spread ideally about your Trade steadily (this is a sign for a well-balanced tradingsystem).
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Consecutive losers (in a row)
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This reference number specifies how many trades achieved losses one after the other. Often one doubts a system if too many loss-afflicted Trades appear. This value is also known as a stress factor.
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Consecutive winners (in a row)
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This reference number specifies how many trades earned profits one after the other
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DrawDown (also called stress factor)
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This value states how much money you would have lost in the worst trading period. This value should be recorded in your risk consideration or tradingsystem valuation absolutely with. They should prefer tradingsystems with a low Drawdown. A high Drawdown stands for psychological stress. Only if you are sure that you can really cope with the ascertained losers with his at most possible loss, you should use the tradingsystem. This reference number often causes a strong psychological pressure on the investor. Their growth capital curve should be growing very steadily.
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Medium result per Trade
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This value gives you how much money you win or lose on average per Trade. Besides, the average about all winners and losers is determined. Here is valid a simple rule - the higher the better. This value is for the evaluation of a tradingsystem one of the most important values.
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Medium result per trading day
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This value gives you how much money you win or lose on average per Trading day. Besides, the average about all winners and losers is determined. Here is valid a simple rule - the higher the better. This value is for the evaluation of a tradingsystem one of the most important values.
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Robustness
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Susceptibility of a system compared with disturbances. How constant the results with variation remain the initial parameter.
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Alpha and beta value
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"Alpha" is the income return of an investment which is achieved by active management of a investment. Alpha, so the income return in comparison to the index, is a result of the investment expertise. "Beta" is designates as the market risk of a stock market.
Target: Establish a tradingsystem that shows alpha > beta.
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