Sharpe Ratio represents the how big is the profit relatively to the balance and the profit volatility.
Simply said, the Sharpe Ratio will be higher when a strategy makes higher consistent profit.
A reason for low Sharpe ratio is a big variation of the profit and loss size.Besides the trading rules, the strategy performance greatly depends on the commission, swaps, and spreads.
I would not put too much attention to the stats metrics.
For me the most important criteria evaluating a strategy is to make a profit on new data, no mater if it is on backtest, real or demo trading.
Simply said, the Sharpe Ratio will be higher when a strategy makes higher consistent profit.
A reason for low Sharpe ratio is a big variation of the profit and loss size.
Besides the trading rules, the strategy performance greatly depends on the commission, swaps, and spreads.
I would not put too much attention to the stats metrics.
For me the most important criteria evaluating a strategy is to make a profit on new data, no mater if it is on backtest, real or demo trading.
I made an EA with EA studio. The EA profits $3536 and sharpe ratio 0.16 with premium historical data.
I run the same EA with different hitorical data in the same period. Historical data-1 gave $4713 sharpe ratio 4.14 and Historical data-2 yielded $6364 sharpe ratio 5.60. Why EA studio sharpe ratio is too low?
any comments I appreciate, thank you