Money Management Optimization
The Money Management Algorithm tool also includes an Optimizer. We introduced the Optimizer Tool in Revision 4.1 to efficiently optimize which algorithms to use on a strategy. The Money Management Algorithms could be used to optimize but if you optimize each of the 13 Rules for every combination of On or Off (since you can combine as many rules as you would like, or trade them individually) the total number of combinations and optimizations (without even optimizing the parameters for each rule) would be 8,192. You can see this when you setup an optimization for each of Rules 1 – 13 to optimize from 0 to 1 with an increment of 1 (testing for each rule to be On (1) or Off(0), think of discrete math and boolean logic here).
The individual parameters could also be optimized before the Optimizer is run.
The OPT money management algorithm strategy allows us to quickly optimize Rules 1-13 to see how each one individually ranks. We can then apply the top rules from the OPT strategy back into our Money Management Algorithm strategy (MM: Equity Curve Algorithms Rev 4.0). We show this in detail in the video below.
In Revision 4.1 of the Money Management Algorithms, we add the optimization tool. The optimization tool allows us to quickly rank the best rules for each strategy by optimizing the Rules from 1-13. Once we rank the best rules we can determine how to combine the rules or then test different entry techniques. This is quicker than optimizing the original strategy inputs from 0-1 for 13 different inputs. This is 8,192 combinations instead of just 13. The optimization tool only tests each rule separately and not the combination of rules.
These Money Management Algorithms allow you to test and automate ideas based on stopping and starting a strategy by keeping the base strategy running to make calculations and then take trades based on the calculations in a new window by using a DLL, dynamic link library.
You can quickly test our algorithms on your current trading systems. You will insert the indicator we provide into your base strategy window and then use the Money Management Algorithm Trading System (that we also provide) that will read the Marketposition and Open Equity of the base system to take trades using rules from any of our Algorithms including the Equity Curve Management Rules, Pinpoint Entry Algorithm, Consecutive Losing Series Algorithm, and more.
You don’t have to re-program any of your strategies. It will allow you to test closed code systems that you own or lease and allow you to have a more “unique” entry price (in the case of the Pinpoint Entry Algorithm) from other subscribers if you are leasing a closed code trading system.
The open code is included so that if you do want to customize the strategy or algorithm, it is will be possible.
We have spent many years and dollars developing these algorithms. Our Equity Curve and Money Management Algorithms provide a quick short cut to have a real time approach to backtesting and automating “A Trading System for your Trading System”.
Money Management Algorithm
Trading System Optimization Tool Video
