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Backtesting a Portfolio

Fintechee 2020-01-18

Backtesting a Portfolio is similar to the Trading Simulation concept. Advanced traders often use Algorithms for Trading to improve the performance to monitor the market movements or to improve the precision of the Trading signals. The instrument which implements the algorithms for trading is called Expert Advisor(EA). Automated trading includes EA based on news events, EA based on fundamental analysis, EA based on technical indicators and EA based on Artificial Intelligence. We need to verify whether algorithms for trading work or not before we apply them on the live accounts. Backtesting provides this kind of feature. We believe that history will occur in the future repeatedly. That’s why backtesting makes sense.

Prerequisites

How Backtesting a Portfolio is Helpful?

We provide a WEB-based backtesting feature in our WEB trader. It’s a unique feature different from the feature that other trading platforms provide. You can only find it in our WEB trader.

In our tutorial for Forex trading, we introduced how to code an EA and how to start backtesting a portfolio. Please read this article for more details: Expert Advisor.

Tutorial Video

Optimization

As we all know, the parameters of the EA are not always compatible with the current market movements. It’s necessary to optimize the parameters before you run the EA on your live account. Optimized parameters can help you maximize the profit and reduce the risk. The tutorial video above teaches us how to optimize the parameters of the EA.

For more features that our WEB trader provides regarding backtesting a portfolio, please read this article: Trading Simulation.

We published the source codes of the samples on our GitHub repository and the page - SDK Trading as well. You can check the source codes of the samples there. If you have any questions, please contact us. Thank you for reading.

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