I promised you last week that I would finish backtesting the second version of the HLHB. And I did! I have dark circles under my eyes from staying up too late but I owe it to you guys for pushing me to apply for the assistant manager position. Y’all are so sweet!
So without further ado, here are the results:
The HLHB System Version 2 Back Test Results (August 2008 to January 2011)
Total Number of Trades: 30
Number of Winning trades: 9
Number of Losing Trades: 21
Win %: 30%
Loss %: 70%
Largest winning trade (pips): 358
Largest losing trade (pips): -150
Average winning trade (pips): 227
Average losing trade (pips): -176
Longest winning streak: 3
Longest losing streak: 8
Largest drawdown (pips): -1428
Average drawdown (pips): -178
Total Pips: -1800
Total %: -7.95%
As I expected last week, the final results aren’t that great. In fact, they’re much, much worse than those of version one. Just look at that 7.95% loss!
I observed from my testing that the system caught a lot of false signals and failed to catch a lot of really profitable ones, which is completely the opposite of what a mechanical system is supposed to do!
This is such a total bummer… But I guess that’s what backtesting is for – to find out whether a system works or not! So, with that said, it’s back to the drawing board for me. For now, I’ll stick with the old system until I can come up with something better.
If you have suggestions, please feel free to comment below. I’ll check them out later after I get my hair done. You know, just in case someone decides to ask me out on Valentine’s Day.