Topic: Steady profit increase on long term or sharp increase in short term?

Dear Popov,

I hav a question regarding which strategy to be selected between 2 cases as below;

1 ) Lets say we have made a strategy that shows dramatical loose at the begining for first 5 months but it shows huge sharp profit increase for last 3 months;

2 ) Lets say we have made a strategy that shows gradually step by step profit increase over the same total period of time of 8 months

Which one do you think is better to select? A stable one to run and let it go gradually up and down in time but make some profit at the end of month or aggresively profit increasing one and optimize weekly to keep it up to market conditions and let your profit increase sharply?

Thank you very much
Seref GOKKAYA

Re: Steady profit increase on long term or sharp increase in short term?

Hello Seref,

Regarding the first strategy, it depends on when it starts making profit. If you are using shorter periods for testing, it is important to notice if the strategy starts making profit from a place where the backtester starts calculating on a new shorter period. Such case may mean that the pessimistic scenario of the backtester is "too pessimistic". You can try the Comparator tool. If this is not the case, the strategy may change from sharp profit to sharp loss very rapidly. You may give it a chance for 2-3 deals with minimum amount, but if it doesn't go on profit, you should probably remove it from the portfolio.

For the second strategy, even small gradual profit is a good sign. You can run both strategies if you like.


The real problem is not when to start trading a strategy, but when to stop trading it.

A good idea is to measure the strategy performance on the trading account. If it makes losing trades just from the beginning, you can remove it for a better time. If recovers in some time (on a backtest), you can return it back.

If a strategy trades evenly with consecutive profits and losses, it may be a note that the strategy can be improved for a better performance.

If a strategy makes a profit, you can use it until it goes well. If it starts failing, you have to remove it before losing the profit it has made.

Re: Steady profit increase on long term or sharp increase in short term?

Dear Popov,

         Thank you for your answer. The first strategy I built with a datafeed history starting from April. When FSB generated the strategy it was with good profit increase then I tested the same strategy a datafeed starting from 1st of January and found out that the generated strategy was loosing till April (till the data I used to generate the strategy) but after april (fom the date strategy was generated on) it starts building up profit. The same I back  tested with MT4 and they match.

I have put it live since last week thursday and it ends every day with a positive profit. I have attached the reults from this week that I have also started to keep a record on strategies generated real performance.
Other strategies I have generated with data beginning from 1st of January and they all show gradual profit increase as I have explained above.  I have put all live and started to keep record on their performance.


http://s28.postimg.org/6pues6l5l/STRtests.jpg

I have attached a pips captured result.

Many thanks
Seref GOKKAYA

Re: Steady profit increase on long term or sharp increase in short term?

That's good. During that time you have to start working on spare strategies for replacements.

Trade Safe!