10
The secret
What topics are covered in this chapter?
The technical trading system involves technical indicators (simple algorithms) that suit the markets in which traders are trading. These trading algorithms have been researched and tested to have a statistical edge. Inherent in trading systems are risk control mechanisms. All signals are automated.
This chapter will introduce the concepts involved in algorithm trading. The concepts will be explained in greater detail with examples in the second part of the book. The most basic concepts discussed here are:
- trading algorithms
- optimised parameters
- robustness
- high return to low risk
- average gain must far exceed average loss
- no unexpected losses
- ability to avoid whipsaws
- ability to enter ...
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