First, look at the equity curves in this chart.
Would you prefer to trade A or B?
The answer seems obvious, right?
This came from a strategy assessment I’m doing for a trader.
We’re looking at making this already profitable strategy even better and considering this rule.
All trades where $FEATURE is above the value $X are in curve A, and everything below $X is in curve B.
It’s tempting to look at these curves and say, heck yeah, let’s apply this rule and improve the strategy.
But this is NOT a rule I recommend applying.
Can you tell me why?
Reply and let me know if you can spot it.
–Dave
