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Backtesting Lab

Backtesting Instructions

1. Create a New Backtesting Page

Button to Copy the Backtesting Template:

New Backtesting Session/Strategy

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Rename the duplicated template page to your strategy name

For the rest of the instructions, use the pages in the duplicated template

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2. Fill out the
`Strategy Overview`⁠
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Not super necessary, this is just details on how to execute your trade strategy / setup

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3. Add Strategy Specific Tags to
`Strategy Specific Tags`⁠
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You can use custom tags to find differences in Expected Value for variations in your strategy

Example - Enter on Market Structure Break vs. Enter on EMA Reclaim

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4. Setup Your Exit Strategies

Exit System Controls

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Exit Systems Explanation

There are 4 sets of controls, with 5 columns in the Backtesting Trades for different exit prices

When you enter a trade you can put the exit price for all 5 of TP options

When you start analyzing your results you can fiddle with each Exit System to see what combination of TP targets give you the best Expected Value

Ex. 50% Swing High TP + 50% on Loss of Trend

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5. Enter Your Trades in
`Backtest Trades & Metrics`⁠
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Backtest Trade Form

Access by clicking new on the

Backtest Trades - Template⁠

table

You can also just make new rows and enter the values in-line

There are more fields than displayed here, but they are all calculated and use to generate the statistics for trades

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Backtest Trade Tags

Field

Description

Token

The

Token⁠

(Duh)

Timeframe

The

Timeframe⁠

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Position Direction

Long or Short

Image

Copy from trading view for review later

Context

The trade

Context Tags⁠

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Confluence

The trade

Confluence Tags⁠

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Risks

The trade

Risk Tags⁠

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Reason for Exit

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Reasons for Exit⁠

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Strategy Specific Tags

The tags you add in

Strategy Specific Tags⁠

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There are no rows in this table

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Backtest Trade Details

Field

Description

Entry

Average USD Entry

Take Profit

The Planned Take Profit

Stop Loss

The Planned Stop Loss

Target R:R

Calculated for you

Average Exit Over Ride

If you fill this field the calculations will ignore all your Exit Strategies. The exit will be assumed to be 100% at the Average Exit Over Ride price. I Typically use this if the stop loss is hit before any TP level

TP $ Fields

The price level for each TP/Exit corresponding to your Exit Strategies

TP % Fields

Over ride the % values for each TP specified in the Exit Strategies

Exclude from Stats

Remove this trade from your backtesting statistics

Useful if you later realize that you wouldn’t enter the trade

Notes & Lessons

Just personal note Fields

There are no rows in this table

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6. Analyze Your Trade Metrics

Filter Types

Filter Type

Description

Include - AND

Only include trades that match all of the values you select in the field

Include - OR

Only include trades that match 1 or more of the values you select in the field

Exclude - OR

Exclude any trade that matches 1 or more of the values you select in the field

There are no rows in this table

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Backtesting Metrics Form

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Backtesting Metrics Filters

Filter

Description

Timeframes

Filter trades by

Timeframes⁠

Position Direction

Filter trades for either “Long” or “Short” positions.

Tokens

Include trades on

Tokens⁠

in the field

Token Categories

Filter for trades with

Tokens⁠

belonging to any of the categories put in the field.

Context

Filter by

Context Tags⁠

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Confluence

Filter by

Confluence Tags⁠

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Risks - No Risks - Checkbox

When checked - Exclude any trade that has a risk tag on that time frame

Risks

Filter by

Risk Tags⁠

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Strategy Tags

Filter by

Strategy Specific Tags - Template⁠

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Reasons for Exit

Filter by

Reasons for Exit⁠

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There are no rows in this table

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Trade Metrics

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There are more, but these are the important ones

Trade Metrics Explanation

Expected Value (EV)

EV is the average expected outcome of each trade (

Investopedia⁠

)

EV = Win Probability x Average Win - Loss Probability x Average Loss

EV - R:R

This is my favourite way to measure EV

Value < 0 is a losing strategy

Value > 1 is very recommended

EV - R:R = 2

Every $10 of risk is expected to yield $20 (Good)

EV - R:R = 0.5

Every $10 of risk is expected to yield $5 (Bad)

EV - $10 Risk

Similar to EV - R:R, just in dollar value

EV - %

Least accurate as it will vary by timeframe and by asset depending on the volatility

Want to print your doc?
This is not the way.

Try clicking the ⋯ next to your doc name or using a keyboard shortcut (

CtrlP

) instead.

Backtesting Instructions

1. Create a New Backtesting Page

2. Fill out the Strategy Overview⁠⁠

3. Add Strategy Specific Tags to Strategy Specific Tags⁠⁠

4. Setup Your Exit Strategies

Exit System Controls

Exit Systems Explanation

5. Enter Your Trades in Backtest Trades & Metrics⁠⁠

Backtest Trade Form

Backtest Trade Tags

Backtest Trade Details

6. Analyze Your Trade Metrics

Filter Types

Backtesting Metrics Form

Backtesting Metrics Filters

Trade Metrics

Trade Metrics Explanation

Expected Value (EV)

EV - R:R

EV - $10 Risk

EV - %

2. Fill out the
`Strategy Overview`⁠
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3. Add Strategy Specific Tags to
`Strategy Specific Tags`⁠
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5. Enter Your Trades in
`Backtest Trades & Metrics`⁠
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