Tuesday, July 7, 2009

Preventing Bias in Forex Trading System

In many cases, forex traders or retail traders are looking for a forex trading system which would help them to take decisions, control risk and make certain profits. Traders from all over the world cope up with such successes and struggles, in all currency markets. A trading system is usually defined as a series of methods implying expectations, position sizes, entries into the market and exits. It is not difficult to construct a forex trading system.
Testing and implementation are not easy to comprehend. Achieving success always requires proper forex education. For forex traders, attribution bias and over optimization are related to one another. Over optimization is initially, a practice of fitting the past data into a model. The problem appears when forex traders begin back-testing the system, and then, start amending the parameters of the system until the past results reaches the maximum value. There is a manual for trading system which will make you realize how the forex markets operate and it also covers the rules for forex trading.

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