I have written many MetaStock related articles. In those articles I guided you on how to use MetaStock in your trading and also provided some explanations on how to design your own trading system and apply others’ trading system into MetaStock as well.
Here in this article, I would like to talk about some tips for designing a trading system in MetaStock.
tip#1. Find a trading system that will produce positive returns in long run.
This is the first thing you have to make sure. You have to find a strategy that has an edge in order to guarantee that you will gain profits from it in long run. Most traders focus on short-term results of trading but you have to be different to be success.
tip#2. The system must contain risk management or money management system.
As I have always mentioned, a good trading system must contains risk management. Even the best trading system in the world is not going to win all the times. There always are draw-down periods in every system. Therefore you have to survive from draw-down periods and stay in the market long enough to make profits from the system.
tip#3. Write down your system in a paper.
After you found a good and profitable trading system, you should write the system down in a piece of paper before program it into MetaStock. This will help you understand the system and avoid mistakes.
tip#4. Do back test for the trading system.
To gain you more confidence in the system, do back test for it and see its results and optimize it. There is integrated tool in MetaStock for back testing. Third party software is also available for you to back test your system.
tip#5. Be consistent.
You have to execute your trades consistently to achieve positive expectation of your system. In order to do this, you must have strong believed in your system which you should already have it if you have followed the first three tips.
That’s it. The simple tips that will help you when you are designing a MetaStock trading system.
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