This is a trading item or a component that was created using QuantShare by one of our members.
This item can be downloaded and used by QuantShare Trading Software.
Trading items are of different types. There are data downloaders, trading indicators, trading systems, watchlists, composites/indices...
You can use this item and hundreds of others for free by downloading QuantShare.
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Works with US and international markets (stock, forex, options, futures, ETF...)
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The simulator tool analyzes hundred of stocks for buy signals and then picks few of them (A portfolio is limited by the maximum number of positions it can contains).
After a simulation is completed, you can display the trades that were generated by selecting the "Trades" tab of the Trading System Report. Inside this tab, you can display Realized Trades or Orders flow.
The number of generated trades is usually much lower than the number of buy signals. For example, in a given date, the simulator may find 120 buy signals but because it has only three available free positions, it can take only three trades.
By creating a time-series metric that displays the total number of buy signals for each period, you can easily visualize periods of high activity or period where the backtester had a lot of choices and period where the choices were limited.
This money management item creates this metric and saves it under the time-series "Buy Signals". You can display this time-series in the Trading System Report graph, by selecting it in the list (Next to - Select a time-series to drag and drop into the chart) and then dragging and dropping it onto the chart.
Based on the number of buy signals, you can create money management rules. Example: Reduce the exposure if the number of buy signals exceeds a particular threshold.
Here is a chart that displays a trading strategy return (Red) and the number of buy signals (Blue):
The above strategy sets exposure to 0% if the number of buy signal exceeds 8.
Trading financial instruments, including foreign exchange on margin, carries a high level of risk and is not suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in financial instruments or foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.
