Why Run a Backtest Without a Stop
By Dave Mabe
In this week's episode of Line Your Own Pockets, I share details of a recent conversation with a trader I'm coaching on why you would want to backtest without a stop.
Note that this doesn't mean you're actually trading without a stop loss, but running a backtest without one can be very valuable.
We discuss:
The two major benefits of running a backtest without a stop
What "maximum adverse excursion" is - terrible branding for a clever concept
How backtesting without a stop leads you to finding an optimal stop loss
Most strategies show improvement without a stop, but that doesn't imply you should trade it that way
And much more...
-Dave
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