February 16, 2017

Use AlgoLab to hedge against stock loses in the case of a stock market down turn

Let say the value of my current stock portfolio is $100,000, and I'm worried about the next bear market. An average bear market loss is 27% and lasts for about 1 year (14 months to be exact, but lets just estimate 1 year for simplicity). In my case, I would want to protect against a $27,000 stock portfolio loss.

So how can I use AlgoLab to hedge, or to possibly offset some of those potential losses, and how much would that "insurance" cost?

1. Open the Performance Viewer and open the "SuperSystem" multisystem, and specify only the three stock index symbols "Sp500 E mini", "NASDAQ index", and "DOW index". Also, since Gold is sometimes correlated with stocks, and sometimes ne...

February 12, 2017

AlgoLab stock index can be more profitable on a risk adjusted basis than buying stocks

Trading Systems Performance Expectations

Algorithmic trading systems have been developed by optimizing system rules, and parameters on historical data. This does not guarantee that past performance will be as profitable, or will exhibit similar characteristics to real-time trading results. Given enough variables, it is possible to curve fit a system to historical data, and any relationship between those rules and future, unseen data may be random. AlgoLab has taken steps to reduce the number of variables and system rules to reduce the degrees of freedom which will reduce the chance of curve fitting. Current market regimes can and do change, and rules that previously...

February 12, 2017

HOW TO USE ALGOLAB WITH A SMALL ACCOUNT (<$20,000)

Trading Systems Performance Expectations

Algorithmic trading systems have been developed by optimizing system rules, and parameters on historical data. This does not guarantee that past performance will be as profitable, or will exhibit similar characteristics to real-time trading results. Given enough variables, it is possible to curve fit a system to historical data, and any relationship between those rules and future, unseen data may be random. AlgoLab has taken steps to reduce the number of variables and system rules to reduce the degrees of freedom which will reduce the chance of curve fitting. Current market regimes can and do change, and rules that previously predicted future prices may no longe...

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