jim_c_hill
61 posts
msg #27428
- Ignore jim_c_hill |
7/17/2003 4:52:26 PM
I am running filters primarily with weekly indictors and then I check past performance by checking three months ago and then using Performance to find out how the filter does on different dates. I note if the first day is large, 2% or more. The first day represents in theory the first day you would trade. However, for the first day you may never be able to obtain that percentage because of a large gap between the close of the previous day and the opening/low of the first trading day which results in the close of today being abnormally distant from the previous close. If a gap occurs then the percentage gain one can obtain is less and an adjustment is needed.
If you are day trading and looking at a monitor with current data you can adjust because you see it. If you place your orders the night before you will pay a price higher than the previous close and thus your gain may be small or even negative if the close is less than the open.
When I see a large % on the first day I tend to discount it in looking at the total % after x days of analysis. Or, I will historically look at the charts to see how often gaps are occuring with a filter, which is very time consuming if the number of stocks selected is large.
JH
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