Backtesting reports show maximum drawdown value for any tested strategy. Is it possible to see drawdowns experienced by individual stock trades? I think it is important to have this information in the backtesting report. Many a time stocks have a drawdowns exceeding -10% before they turn around and give positive returns. If I happen to sell these stocks just because they lost 10%, i will end up having a 10% loss instead of having a profit!

If I can see in a backtesting report how many winning stock trades give initial drawdawns exceeding -10%, then it would help me decide about having a stop-loss or not. Some experts such as Larry Connors believe that having stops hurt traders. Some of my back testing strategies (not RW strategies) in other software support Larry's claim.

I am interested in knowing what other forum members think about this?

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at 03/31/12 9:25 PM : RE: Maximum Draw Down

at 09/15/12 4:41 AM : RE: Maximum Draw Down

at 04/01/12 8:31 PM : RE: Maximum Draw Down

Hi, understand. But what if the stops all got it because of flash crashes that are so common nowadays? Will we not sustain big losses especially if there is leverage involved?

What you think?


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