Forwardtest

A forward test analysis allows investors to follow an automated system as it currently moves through time. This technique eliminates the ability of the system designer to create a system that worked in the past, but does not adjust for current changes in the market dynamics. Members of 4xproject can follow a system and determine if the claims of the past, work during the present.
At the beginning of the forward test process, we open a demo account, at a broker that we trust, with usually with 1000 USD. Our next step is to run the Expect Advisor (EA) according the specifications in the manual provided with the EA. For systems without setting recommendations in the manual, we use default settings of the EA. The results are automatically updated once per hour and show average results on weekly base. We run forward test on demo-accounts usually for 8 weeks before we decide to either advance the EA to a real money LIVE-account or terminate the testing.
The forward test Chart table represents daily tests that are performed by the team at 4xproject.com. The bar chart, which moves above and below the zero line, displays both the notional movement in pips for a currency pair, as well as, the average weekly return since 4xproject began testing the systems. On the left axis of the chart is profits in pips for an average week, and the right axis is profits on percent for an average week. To read the chart you can find a blue colored bar and determine how well a specific trading system performed during the average week in percentage terms. The same display is available in a yellow colored bar for actually pip movement.
The chart is a dynamic representation of the results and many aspects of the chart have drill down features that allow our clients to receive detailed information on each component. For example, by clicking on the result bar, a link will move to a page in which the detail of the results will be displayed. On the top section of the page will be the name of the system, the currency pair being tested and the number of overall stop losses and take profits that have occurred since the inception of testing of the system. A stop loss is a specific level where the system closes an open position at a loss. A take profit is a specific level where the system closes an open position at a profit. There is also a link to the home page of the system.
In the next section of this page, a client can examine the weekly returns that create the average weekly return of the system that is displayed on the initial forward page. This section is broken down into both a table format and a graphical format. On the table section the weekly gain or loss in pips and percentage is listed first. This is followed by the number of trades, the percent of winning trades, the maximum gain or loss, realized (closed) profit and loss, and unrealized (open) profit and loss. The percentage of winning trades is the number of trades that are closed with a profit. The maximum gain or loss is the greatest profit or loss that occurred on a trade, during the course of the week that is being tested. Total profit in percentage, maximum draw down in percentage and the number of weeks that have been tested are listed last. A maximum draw down is the most the system looses from peak to trough.
To further drill down on this page, a client has the opportunity to click on statement which will display all the trades that have been transacted, along with all of the pertinent statistics.
The graphical display on the forward test page represents the specific profit and loss (P&L), per week, in both pips and percentage terms as the system is tested through time. The P&L is graphically displayed using two lines which represent pips and percent return.

Last update: Feb, 9 2010, 4:21am (GMT)

Expert Advisors in Forward-Test

Expert Advisors removed from Forward-Test (Demo-Accounts)

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