Forward Testing vs Backtesting, Which is Best!? 💎

[@foxtrotbravo1744]

"Curve fitting". You are the first person online, who I follow, that has identified this issue with technical analysis and back testing. I watch people drawing lines on charts, picking points to match their beliefs, and it's like watching someone give answers from an Ouija board. Good video, from a long time lurker.

[@jeroencommandeur]

I'm a pure algo trader and have build extensive simulators to test my strategies. Curve fitting is, indeed, -the- thing to watch out for. Another is to make sure you have strategies for different circumstances (bear/bull markets etc) and being able to switch between them accordingly. Plus you won't believe the amount of time testing actually takes. Well worth it though, as algo trading scales enormously. For me, scaling + psychological advantages are -the- reasons to choose algorithmic trading, really.

[@jambear7862]

Hello how did you set up the algorithms, I have some excellent strategies tested on SPX and need to have these automated, any help appreciated?

[@0runny]

As a systematic quantitive trading system developer, optimising by looking at past data (aka backtesting) is a OK, but be careful with overfitting. Forward testing (also known as walk forward testing) must be done with discipline, i.e your system must not use any data from the future. I now use rolling window optimisation and test that using walk forward test. This means I have a rolling look back period which I use for optimisation which I then apply on a walk-forward testing basis.

[@howtwodoit]

👌. Forward testing and collecting all that data is better than backtesting... You'll always try and tweak the backtesting.... Forwards testing👍. I recommend to do Forwad testing then, after a week of trading do the backtesting of that week and see if you executed properly.

[@ukspreadbetting]

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[@jb_makesgames2264]

Very import yet very understood topic. You video spoke to some of the issues but you did not seem to reference any of the points listed on your whiteboard. Backtesting is most effective if your are trying to optimize your strategy after which you test in during forward testing. If your not optimizing then forward testing may be all you need, You also need to touch on the mechanics of forward testing, ie using simulated or real data.

[@coletaylor9847]

about to hit year 3 and I think I have to walk away, financially. Can't get the pieces to fit together over time.

[@davidfitzgerald3708]

Thank you Mark🥇

[@consciousmoviereviews9730]

I love your lessons per episode. As a special request, please slow down a little. Take some time to pause and do an overview of what you discussed. When you go so fast, I have to keep rewinding it at times and don't have time to process what you just said when you speed talk to the next point. Please keep your viewers' attention spans in mind and slow down a little so the concepts can be absorbed.

[@peowpeow]

Disagree, I love UK’s accent, proper native English :-)

[@AFter-instrumentals]

Hi I usto watch your videos when I first started, I turnt to trading as a place of self destruction during a hard time that lasted 2 years . I'm stopping for 6 months then only attempting prop firms. I can't trade at all at the moment I have a loosing mentality. 6 month of taking care of myself and looking after my money might help, if anyone is going through a mess just stop work on yourself and come back when your heads straight

[@ukspreadbetting]

That's very sound advice about taking a break from trading. I'm afraid a lot of traders are having a difficult time at the moment but the hardest hit will be the 'new generation' traders/investors who believed in the 'growth stocks but unprofitable' sector.

[@AFter-instrumentals]

@@ukspreadbetting I just feel anyone who is putting in there months wages and causing a lot of issues should change there direction and I think about prop firms. With the mindset of going for these challenges would keep there money in there pocket and fund new focus in re learning and finding strategies. Sooo many months in these last two year I've essentially gambled. Even if I failed the challenges ten times, I get to keep my passion and the money in my pocket. I can trade correctly then in comes the undisciplined moonshot. And this an extremely bad habit that could only be brocken by walking away and improving personal life. If you can't respect your money or yourself, you will never respect a trading account. How you respect your account is a direct reflection of how you respect yourself, there's no way in hell someone can be doingit for two years and not say to themselves this position is bad with the inability to close it. Enhance your life enhance your trading

[@AFter-instrumentals]

@@ukspreadbetting if you trade incorrectly with a prop firm they will close your account, I blew a demo and thought, I can only succeed if I stop walk away and come back later

[@peowpeow]

When your life is a mess you shouldn’t expect positive attitude to other sectors including trading.

[@trolley2327]

backtesting is just a filter to make sure that the strategy works in principle , and maybe we practice a bit with it , and forward testing is the real thing. Ofcourse , big data analysis of a strategy is a different story

[@MarketVVizard]

Hey i just joined the community but i cant log in 😶

[@ukspreadbetting]

Please e-mail traderATfinancial-spread-betting.com (remove the AT and substitute by @) and I'll pass the enquiry to Mark's team.

[@Melodynb-d9y]

so messy..