I was asking OP tbh.
edit: from a look through your site it looks like you calculate 'probabilities' based on past outcomes (correct me if I'm wrong), that is, in a Gaussian context, and definitely not based on methodology.
If you really want to use math/software to test your ideas the only simple approach is via monte carlo simulations.
#1 i use the same exact methodology to enter into the market everytime. if you want to find out exactly what the detailed methodolog is your going to have to watch the "movie" ...
#2 i have a monte carlo simulator... but i fail to see how one would make you a better trader , other than to give you an indication of the infinite number of equity curves that are possible for any given function of x depending on the risk parameters entered into the formula that will graph your monte carlo simulations.
my spreadsheet CAN be used to "backtest" but that is not what i use it for necessarily....
my spreadsheet helps me to calculate the probabilities of the trades i want to trade (according to a mathematically based selection process),as well as to Quantify, & Record the exact methods i use to execute any given trade i may take...
you see, what i am really interested in is the quantitative measurement of my own executions & decisions to enter the given data set of trades that i execute... i am interested in mathematically figuring out the actual effectiveness of the decisions that i make according to a predefined mathematical model that i have determined to have a positive expectency, based on the monte carlo simulations ive run...
however, i think most people err in relying on the montecarlo simulations as much as they do because most novices are really concerned about finding the perfect holy grail system that will produce a 95% winning percentage and will turn 5,000 usd into $1,000,000 over night...this is unrealistic and not what is needed to achieve consistent profitability.... like i said earlier the typical money manager is only "right" 4, maybe 5 times out of every 10 trades executed... with those numbers trading becomes an exercise in discipline, consistency, & trade management, rather than one of strategy or mathematical calculations...
i use the math to understand the market and how my trade decisions compare to the overall market, as well as to force me to take the trades i have predetermined to execute exactly as i have mathematically defined them... ahead of time... by the time i sit at my desk, the strategy i will be trading is already programmed into my mind and there is no need for math, models, or strategy at that point in time.... if your trying to define all of the variables that need to be defined consistently in order to turn consistent profits, 5 minutes before you enter a trade, its already too late, youve lost.
the most important thing to remember is that the software is a tool that is to be used in order to force you stay true to your long range goals within a mathematically defined day to day framework... its easy to say i wanna make 10,000 pips this years, its another thing to actually stay true to a plan that is going to earn you those gains 100 pips at a time...
you see, the way i see it, no one person has the resources to study all 100,000,000 possible occurrences of every single probability curve that has the potential of playing out... at some point or another a wannabe trader is going to actually have to decidedly put his balls to the fire and test out his ideas; at that point the whole idea goes from finding a strategy with a positive expectancy, to an exercise in trade management through the objective use of risk management, money management, & position sizing rules... defined in mathematics...
so to answer your questions, that, in essence, is what the spreadsheet is for: to quantify my predefined mathematical models that I know to have a positive expectancy after i have decided to trade those strategies. if you waste your time back-testing your ideas for an entire year you are not trading, under those circumstances, one cannot be considered a trader... you have to trade to be a trader!!!
what one must attempt to do is to use mathematics as a tool in order to find verifiable, and objectively ACTIONABLE ideas that can be efficiently managed with mathematically defined technical rules, risk management rules, money management rules, and position sizing rules...
my software is not a testing tool. its a trading tool. i use math to psychological anchor myself to the factual belief that my systems produce a net gain over the long term, using the software i stay very much focused in the details of my day to day trading activities... working towards my particular end game...
the software helps me record the day to day details in a mathematically objective format that forces me to stay on the mathematically defined course i have defined for myself that i have identified as the consistently profitable path that will take me where i want to go...
For Traders: Forex Trading Systems – Stock Software & Free Spreadsheet
that path is the path of a consistently profitable trader... nothing more, nothing less.... the site is basically the publishing of the "scientific experiment" i conducted to prove my case that consistently profitable trading in a retail account using mathematically defined and quantitatively defined strategies was in fact probable, & very possible... i invite you to review my work... the 2 hour "movie" explains the experiment i conducted over the course of the past 12 months...
Trading Science: Rules of Engagement
the final part of any scientific work is the peer review of the published work... my site is an attempt at facilitating that peer review in order to start an objective conversation on the subject to advance my interests trading the markets...
i dont have the answers as to why they move, that is a job for CNBC to do... my job is to put myself in a position that will allow me to participate in the moves that play out in the market everyday... i see the market as a neutral source that provides me with the data feed that i need to execute the decisions that i make in order to earn a living trading everyday... thats it... if i lose, or if i make a bad trade its my fault for executing a bad trade; at that point, it then becomes my job to minimize the risk i am exposed to in order to protect my capital so i can execute more actionable trade decisions the next day...
make sense??
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