196: “How to avoid curve fitting using independent testing” – Jeff Swanson
Better System Trader
The Process of Independent Testing
All my trading systems have start out as a key idea. What is key idea? It's nothing more than a simple observation. And so you have your key idea. I'm going to call that my base line. Now, ok, we're goin to compare everything in forward to our base line. Maybe after a i've tested 20 different ideas maybe three of em look good. So then at the very end, what i do is lug these in all together at once. This is all working on the ensample, and seein what it looks like a there. If it looks good, then we can move forward to validate, doing thevalidation on the oute sample.
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