How to optimize the stop limit of a trading system

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How to optimize the stop limit of a trading system

Updated on 2011-05-14 04:43:27

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The following lesson will show you how to create multiple combinations of a trading system by varying the limit value of a stop. The same technique can be applied to any type of stop (Stop loss, trailing stop, profit stop and N-Bar stop).

Steps:

- Update or create a new trading system
- Enable the "Stop loss" by clicking on the (+) icon next to it
- Click on the stop limit value
- In the input field, you have to create a variable by typing a word or letter (Example: a)
- Click on "Tab" to validate; a new line will appear in the optimizer grid
- Select a minimum, maximum and step value

Example:
Minimum = 10
Minimum = 30
Step = 10
This will create three combinations. The first one has a stop loss limit of 10%, the second one has a limit of 20% and the last one has limit of 30%.

- Click on 'OK' then click on "Save/Update Trading System" to save changes.
- In the simulator manager, click on the "Optimize" button to backtest the different combinations you have previously created.

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