For a Classic Trend Follower, Quants Can Help the Cause

Quants can be Useful to Classic Trend Followers Price in a financial market is a consolidated statement of all participant behaviour at a snapshot in time. A summary point estimate of the collective action of participants in the NOW. In a complex adaptive system comprising many participants, the behaviour of each participant creates a perturbative

Backtesting – The Good, the Bad and the Ugly

The Good, the Bad and the Ugly of Backtesting We have previously discussed how the central aim of Classic Trend Followers is to ‘Hunt for Outliers’. This is achieved through diversifying our simple Trend Following Models across a vast array of different liquid markets. We can of course manage our capital risk at all times, but

Traders Outpost Podcast 08 – An Overview of Some new Portfolio Creation Tools

Fred and Rich discuss and demonstrate some new powerful tools developed within the Metatrader 4 (MT4) environment that allow traders to use fully automated methods to construct powerful risk-adjusted portfolios. These algorithms will be made available for use by our Premium Forum Members. These tools currently work at the individual market level (sub portfolio) and

Backtesting and Diversification – The Essentials for Price Following

There is always the inevitable debate between those who think backtesting is a waste of time and those who treat the process like gold. This argument typically splits us into our two major trading philosophies we have discussed before…….. that of prediction, where the emphasis is placed on recent market conditions (hence backtesting long data sets is meaningless) and that of price following (where future conditions are unpredictable and we like to test our systems over a broad set of market conditions in the past to see how well our systems manage risk).