V. 20:12 (44-47): Testing Signal Efficacy by Jeff Parent

V. 20:12 (44-47): Testing Signal Efficacy by Jeff Parent
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Testing Signal Efficacy by Jeff Parent

Here’s how you can evaluate how effective your trading system is.

ot unlike new pharmaceutical drugs, buy and sell signals must be put through rigorous tests to determine their usefulness. Only when signals prove profitable repeatedly should the indicator being tested be incorporated into a trading system. But how can you quantify how effective your signal is? In this article I will suggest a standardized process to achieve this goal.

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