How Accurate Is The Back Testing Of Forex Robots

Do the results of back testing mirror the forward testing results

. Certainly the back tested results put forward by the more unscrupulous purveyors of Forex Robot trading schemes are to be lightly dismissed.

It is easy to adjust the trading parameters retrospectively to suit the result. Widely optimistic claims are just that. Rational, reasonable results are to be believed.

This is not what I am referring to here in my title, although it could be the subject of another article. What I am referring to is the work that we may conduct of a Forex Robot that we have purchased.

We conduct a back test, back a week, month or year. We are feeling comfortable with what we see, and we feel excited with what the future holds.

But, we remain cautious about whether the program will perform in this manner going forward in live trades. Subsequently we remain wary to let it run with the high number of lots that we back tested with.

It is a rational concern; after all we have all heard and read the hyperbole about back testing is not to be compared with forward results. Ok, what is the truth here!

Back testing does not have to deal with good or bad news emanating from the USA primarily about the state of the economy, this is true. Good and Bad news can sometimes throw the markets into a tailspin.

What I have found is that the back testing of Metatrader, whereas it is not the ideal medium, it is reasonably indicative of the results going forward. If, it has some downfalls, so be it, I still find it to be a great assistance. I have not noticed any great differences between back testing and forward results.

If the back testing is showing results that you are comfortable with, then go live. Start conservatively, with a reduced number of lots, and evaluate the results on a 24 hour basis.

I have conducted numerous back-tests, and whilst metatraders back tester is not the ideal it is still very helpful. It is exciting to watch a Robot make the trades without your constant concentration of the computer screen.

I am firmly convinced of the viability of Forex Robot Trading, and will continue to trade in this manner. Forex Robot trading is an exciting means to generate substantial income if commonsense, practical and conservative methods are adopted.

Back test by all means, then forward test to prove all is Ok then go live. Back testing can be very helpful in checking that the program is stable, and that no unusual trades are taken.

by: Peter Froggatt

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