Experienced traders and market experts gather for a panel discussion on trading strategies, backtesting, diversification, curve fitting, fundamental analysis, and systematic trading. They share insights on avoiding biases, handling market expectations, and the importance of historical data in making trading decisions.
Price action is vital for trading decisions, relying on signals over biases.
Unbiased backtesting using reliable tools like Transpider ensures robust strategies.
Continuous learning, diverse testing, and reliance on price mitigate curve-fitting risks.
Deep dives
Trading Panel Introduction and Purpose
In this podcast episode, a trading panel is introduced, consisting of experienced traders and podcast hosts. The panel aims to provide valuable insights and discussions about various trading strategies and approaches. The podcast host, Andrew Swanscott, gives an introduction of himself and his algorithmic trading style, while Jason from Against All Odds Research discusses his experience in trading and the motivation behind the panel. Other traders like Mayhem, Mike, Keshav, and Pavel also introduce themselves and share their respective trading backgrounds and styles.
The Importance of Price in Trading
The panel emphasizes the significance of price action in trading decisions. They highlight the importance of basing trading strategies on price movements and momentum rather than personal biases or opinions. They share how they rely on price signals to determine entry and exit points, irrespective of external narratives or expectations. While considerations like fundamentals and news can supplement trading decisions, the panel stresses the need to let price guide their strategies and avoid overfitting or curve-fitting by adjusting strategies to fit desired outcomes.
Strategies, Backtesting, and Avoiding Curve-Fitting
Panelists discuss various aspects of backtesting and strategy development. They highlight the importance of unbiased backtesting using reliable software tools like Transpider or Realtest, as well as custom-built systems. They emphasize the need to test strategies on different instruments and timeframes to ensure robustness and minimize curve-fitting. Mayhem shares how he focuses on price agreement and momentum when developing his strategies, while Mike and Jason discuss the significance of systematic trend following and avoiding biases in system development. They all stress the crucial role of portfolio-based testing and effective risk management techniques.
Market Dynamics and Avoiding Overfitting
The panel dives into the challenges of market dynamics and avoiding overfitting. They caution against relying on biases or news narratives that are not confirmed by price action. They share experiences of how investor biases and narratives can lead to curve-fitting and poor trading decisions. They emphasize the importance of staying true to tested strategies, focusing on diverse market conditions, and avoiding emotional reactions to market movements. The panel also highlights the need for continuous learning, staying updated with market information, and remaining objective in trading decisions.
Resources and Final Thoughts
The panel provides recommendations for resources and information to further enhance trading knowledge. They mention platforms like TradingView, Pine Script, and Python for backtesting and strategy development. Additionally, they share their respective websites, podcasts, and social media accounts for traders to connect, learn, and stay updated with their insights and experiences. With a focus on continuous learning, objective decision-making, and reliance on price action, the panel concludes the episode with positive anticipation for future discussions and engagement with the trading community.
Welcome to a new trading series called "The Trading Panel", where I collaborate with Jason Perz from Against All Odds Research and a panel of traders to discuss the markets and all things trading. Participants on this weeks panel are:
Andrew Swanscott
Jason Perz
Kashyap Sriram
Markets & Mayhem
Mike Melissinos
Pavel Kycek
Timestamps[00:00] Introduction to The Trading Panel [00:53] Speaker Introductions [08:23] Discussion on Trading Strategies and Market Positions [15:18] The Importance of Backtesting in Trading [20:06] Diversifying Trading Strategies and Portfolios [25:07] Handling Market Expectations and Predictions [28:36] Strategies to Avoid Curve Fitting in Trading [33:32] Price Agreement and Trading Decisions [38:31] Combating Curve Fitting with Simple Strategies [41:07] Fundamental Analysis in Trading Decisions [43:33] Systematic Trading and the Role of Historical Data [47:44] Closing Thoughts on Curve Fitting and Trading Strategies [52:16] Wrapping Up and How to Follow the Speakers
Disclaimer:
Trading in the financial markets involves a substantial risk of loss. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice.
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