Build your Algo portfolio - free download
- Alan Lee
- Apr 7, 2019
- 2 min read
Updated: May 30, 2019
By combining a few strategies on different forex pairs, you can de-risk and diversify your portfolio.
For example, check out these individual backtests for some trading systems which we created:
If you put all these 3 on one account, do you know what your theoretical backtest results would look like?
They look like this:
As you can see the lower 3 curves are for the individual systems and the top blue line is what the combined equity would look like if you're trading all 3 systems on the same account. Starting with $100 you would end up with just over $500 which I'm sure anyone would agree is a fantastic return.
The other interesting thing is what combining these systems does to drawdown.. it's not a simple thing which you can calculate, you can to measure out the equity troughs but for us, it has brought the overall drawdown down to 7.55%. And the reason this happens is because as you're experiencing a drawdown with one system, the other or others are in a winning position thereby decreasing your overall drawdown... of course, this will not always happen, you could have all 3 systems in losing trades and then suffer a larger drawdown but the key here is to find winning systems which work on pairs with little or no correlation.
Now I've created all these systems with machine learning and AI.. they all backtest as per my charts above with 99.90% data accuracy. Still, for those who have been in this space, broker spreads, execution speeds and data feeds could still mean different results in live accounts.. and no doubt, there will be variations in results with different brokers. I'd like to offer you these versions for testing on your live accounts.. it is exactly these systems above which you are testing, they are LITE versions which mean they will trade only 0.01 fixed lot sizes but otherwise completely unrestricted. If you're willing to test these and report in regularly with results, and assuming they work as they do in the backtests, I'll provide you a licensed version which you can adjust the lot size for use in your own investments. These all are built for the Metatrader 4 platform and don't come with any support.. you'll need to install and run them yourselves!
Condition of Use / Disclaimer
Trading the financial markets involves the risk of loss as well as the potential of profit. The possibility exists that you could sustain a loss of some or all of your initial investment and you should not invest with money that you cannot afford to lose. We will not accept any liability for any loss. By choosing to go ahead with this, you confirm that you accept this risk
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