2.6.1 Changing Backtester settings

With ChartNexus XPertTrader, you can build and fine-tune trading strategies that mirror your own investment behavior and risk profile. You can do this fine-tuning and tweaking by changing some of these parameters.

Click on the Configure button in Backtester to configure the following five classes of settings:

General settings

The General Settings window is shown in Figure 2.15.

• Price constraints
  Test on stocks with prices falling within the specified minimum and maximum price range.

• Volume constraints
  Test on stocks which average the specified volume over a particular period.

• Bid/Lot size
  This specifies the minimum allowable bid/lot size of shares.

• Buy/Sell price trigger
  If set to Close price of triggering day, Backtester will take the trade price at the close price. If set to Open price of next day, Backtester will take the trade price on the next day’s open price.

Market trend

The Market Trend window is shown in Figure 2.16.

By clicking on the relevant checkbox, you can specify to backtest stocks using any of the following conditions:

• Uptrend.

• Downtrend.

• Range-bound.

In addition, you can specify (or customize) the trend:

• Short term (10 days by default).

• Mid-term (21 days by default).

• Long-term (50 days by default).

NOTE: Stock Screener and Backtester each has its own Market Trend settings. So changing the settings values in Stock Screener will not affect the values in Backtester and vice versa.

Capital allocation

The Capital Allocation window is shown in Figure 2.17.

The Allocation Method can be set to:

• Equal weightage
  The amount of available capital is divided equally among all the stocks triggered.

• Order of appearance
  The amount of available capital is used to buy the stocks that are first triggered and returned.

NOTE: If the checkbox next to Profits Allocation is checked, the profit obtained from earlier trades will be used as part of the capital for future trades.

You can also configure your capital allocation by changing the settings in Capital Allocated Per Stock and Maximum Numbers Of Shares Purchase Per Stock under Capital Allocation tab.

Portfolio strategy

The Portfolio Strategy window is shown in Figure 2.18. You can set your portfolio preferences (long/short) and maximum number of opened positions in this window.

Stops

The Stops window is shown in Figure 2.19. Some investors have their own profit taking and stop loss strategies independent to technical indicators. ChartNexus has incorporated these settings in Backtester to allow you to decide when to exit from winning positions or losing positions.