October 13, 2016
The HTML file below starts to elaborate on trading methodology infrastructure. It is part of the background information needed to go forward. It uses a MACD trading strategy as an example to set mathematical structure to trading procedures. It could have used something else; the whole point is not on the MACD but on trading strategies in general.
It is a transition file needed to understand what is coming.
The next article, A Portfolio's Core Position, will elaborate on the premises presented in the present article and will try to show that there are things a trader can control. The article after that might end the series with a bang. It is a conclusion that should give any developer more than food for thought since it provides an equation that could help improve any trading strategy.
The premise is that if you can express mathematically the outcome of an automated stock trading strategy using its metrics, then you know where to concentrate your efforts to improve its design. Hope some will find it helpful.
Again, the document is offered in HTML due to the equations. I found it easier to do it this way. However, no one needs the math to understand the message. It is only used to emphasize the points presented. An equal sign is a tough argument to break; it certainly is not an opinion.
HTML file: Extracting Tradable Information
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Related articles part of this series, as they were written:
The Payoff Matrix
The Game Inside
Strategy Design Defects
Strategy Enhancers
Trade Detection
Created... October 13, 2016, © Guy R. Fleury. All rights reserved.