Please help me in evaluating a Bank Nifty strategy

#1
Hi,
There is a amibroker strategy for BankNifty. This is supposed to have given 45% compounded annual return starting from 2010 with draw down of 15%. This strategy works on daily time frame and the returns are without any leverage or Margin. Here is the Equity curve graph :


1_ Portfolio Equity.png


Somebody wants to sell this strategy as dll to me. Do you guys think that this strategy may have some potential or (Are there already publicly available strategies which might be giving similar or better returns? )

If you think this strategy might have some potential then are there any additional details I should be asking before committing anything?

Thanks in advance.
 

travi

Well-Known Member
#2
Hi,
There is a amibroker strategy for BankNifty. This is supposed to have given 45% compounded annual return starting from 2010 with draw down of 15%. This strategy works on daily time frame and the returns are without any leverage or Margin. Here is the Equity curve graph

Somebody wants to sell this strategy as dll to me. Do you guys think that this strategy may have some potential or (Are there already publicly available strategies which might be giving similar or better returns? )

If you think this strategy might have some potential then are there any additional details I should be asking before committing anything?

Thanks in advance.
How much is the .dll being sold for ?
If it has the kind of return it claims, why doesnt the seller profit of it instead ?

Always remember, trading is only 30% strategy, the rest lies in Psychology and Execution.
AFAIK, Backtest results are always better than in real-time, have you tested it LIVE?

There Is a lot to ponder, and given the kind of post you posted, seems like a lot of low confidence in yourself than in trading.
 
#3
Let it go, imo!
All the more if you are new to trading, definately let it go.
U can have better if you just look with in and not outside to become a profitable trader!

Cheers, :)
 
#4
Thanks Travi and McNish,

You are absolutely right. I am low on confidence and I am new to trading. I have lost my job a few months back and have enough capital (Around 20 Lacs) for trading but not for earning livelihood through Mutual fund route so looking for something which can give me returns substantially better than mutual funds.

I am more inclined towards System based trading rather than charts or gut feel based, Basically anything which can be back tested. I know a little bit about amibroker and tried to create some systems and also tried a few systems available on internet but could not find anything half good. That's why I asked if anybody can point me to any system which has demonstratively given decent returns.

This person who has created this dll is an old acquaintance and is using this system live for last three months.

So basically my question is if the system is fake then its my headache. But if the system is real than do you think it might be worth going for. Are there any other parameters (Other than return and draw down ) which I need to focus on? And it would be a great help if some body can point me to a quantifiable system which has given good results in indian markets.
 
#5
Hi

There are many (100's if not 1000's of things) about how to evaluate a system
but the most important one is "You should understand How it Works"

Unfortunately, this is not possible with a black box system.

The main problem with these "systems for sale" is Curve Fitting,
i.e Over optimizing the parameters to fit the old data

What you need is a very robust system that works across different scenarios.

It is very difficult to to get over the lure of easy money,
specially if some one you know/trust is selling 'snake oil'
All of us who have been there can readily sympathies with your situation

Anyway, you will do what you will do . . .

Do educate yourself about "How to evaluate a trading system"
So that, you can yourself take this decision, and not base it on
the opinions expressed by some random people on internet forums

Happy :)
 

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