TradeSim

TradeSim application is a realistic true portfolio trading simulator and back tester available for Metastock.

TradeSim is the first true realistic trading simulator/analyzer for Metastock® that can quickly back-test and evaluate a trading system across a portfolio of securities. With its powerful data processing capabilities TradeSim can evaluate the historic performance of a given trading system within a matter of minutes and do it with a realistic representation of a real life trading scenario.

Typically your system will comprise of entry and exit triggers, prices as well as an initial stop loss. These five parameters basically define a framework for a trading system. The trouble with trying to test a trading system is that the system tester built into Metastock is only limited to a single security and only one position size model with a fixed initial capital. As a result this can give a very distorted view of your trading system performance, which can be very misleading for a number of reasons, namely:

Because back testing has only been applied to one trading entity and not across a wide range of trading entities from different industry groups, the result is an unrealistic representation of a typical real life trading system, which is usually traded across a diverse range of securities.

Limiting of system testing to a single trading entity will result in an inadequate number of trades. Back testing your system using one trading entity may only yield twenty or so active trades. Hardly enough to evaluate its true performance and very misleading from a statistical point of view!

Insufficient choice of position sizing models limits evaluating the system using a position-sizing model, which may not be optimal for the trading system under investigation.