FX TRADING STRATEGIES
logical and equality operators (and, or, >, <, etc.) to form an entry or exit rule. In addition, it supports different order and exit types (market order, limit order, fixed profit target, exit after X bars, etc.).
With all the possible combinations of rules and orders, Genetic Builder is capable of generating literally trillions of different possible trading strategies.
The building process itself is completely random - builder randomly picks different building blocks from the available pool and combines them to create entry rule, order type and exit rule.
The result is a completely new trading strategy.
Of course, not every randomly created strategy is profitable, but Genetic Builder can produce and test thousands of them per hour, and surprisingly high percentage of strategies in this amount are profitable and sound.
Employing Genetic Evolution
Genetic Evolution takes the process of finding suitable trading strategies even further.
In this mode Genetic Builder first creates a number of random strategies, which are used as the initial population in the evolution. This initial generation of strategies is then “evolved” over successive
24 FX TRADER MAGAZINE April - June 2012 Image 3 Choosing building blocks
generations using genetic programming technology.
This process imitates in the
evolution - algorithm chooses the fittest strategies (using selected performance criteria)
every
generation, and the group of fittest candidates is then used to produce new generation of strategies using genetic operations like crossover and mutation.
As in evolution, this should result in better and better candidates, in our case in strategies that are more profitable, more stable, or generally better in the selected performance criteria.
Seeing It in Action
The resulting strategies depend on the building blocks
you
choose. You can choose to use only price action, without any technical indicators, or select a specific group of your favorite indicators.
You can also choose more general strategy options, like minimum and maximum size of protective Stop, etc.
After trader choses the data, timeframe and strategy options he can press the Start button and Genetic Builder will start crafting the strategies and show
Image 4: Setting strategy options Advertorial
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