In this issue:
I. How to use the Trader’s dates tab by Marge Sherald, COO
II. Granny turns 218 on June 14, 2012, and you get the presents!
III. Help us help you
IV. New credit card system for orders
V. Summer hours
VI. One way to stop this newsletter
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I. How to use the Trader’s dates tab by Marge Sherald, COO
I’ve had several tech support calls over the past month that involved questions about the different data sets in the Trader that may be used for model creation: Optimization (training), Paper trading, and Trading (out-of-sample). If you don’t see selections for these different data sets on the dates tab of both the prediction wizard and the trading strategy wizard, go to the Trader’s Tools Menu/Options. First go to the Wizards tab and click on the “Select All” button. Next go to the Advanced tab and in the Date Interface Settings, click on the check box for “Allow real trading to begin before last chart date.”
Now if you look at the Dates tab in either the Prediction wizard or Trading Strategy wizard, you’ll see a check box for “Save optimization which performs best on later paper trading”. Click on the check box and the orange Paper Trading section is displayed on the data bar. Below that you’ll see a check box for “Starting Trading before last chart date,” which when checked displays the green Trading period on the data bar. Above each section on the data bar, you’ll find drop down boxes with options for match chart, specify a date, or choose a certain number of minutes, hours, days, months, etc., depending on the chart’s bar size.
For example, if you want to insure the optimization period includes samples of rising, sideways, and falling markets, it’s best to use the specify date option. Look at your chart, and select a period that matches these different market types. For more information on how to select data, see “Selecting in-sample, paper, and out-of-sample periods – Commentary by Steve Ward” in the Changes in Documentation section of www.ward.net.
The optimization period is the data that is used to create the model. The optimizer tries out various parameters for any indicators used as inputs to a neural net model, and may also select certain inputs and discard others. The optimizer does the same for rules in the trading strategy. After a specified amount of time has passed or the model has improved based on the chosen objective function, the model is saved and applied to the orange “Paper Trading” data. Depending on the Paper Trading results, the model will continue to optimize on the gray “Optimization” data or optimization will end. When this cycle of create a model on the optimization period and test on the paper trading period is complete, I like to think of the model as being “set in concrete” (matches the gray color of the optimization period bar). That is the model that will be applied to all future data. You can simulate applying the model to future data by choosing to use the Trading data, which never changes the model and is the “out-of-sample” data from statistics.
There are times I don’t use a paper trading period, for example when I want the model to be based on the most current data in Forex markets that change frequently. When working with intraday time frames for other instruments such as stocks, I’ll frequently skip the paper trading period, because the number of bars on 5 minute models for a stock offers the variety you need to train a robust model. I still like to watch the model in real time before trading real money just to be sure the model didn’t overfit.
On the other hand, you might want to choose a paper trading period based on a down market to train one neural network and separately train a neural net based on an up market paper trading period. Create a Trading Strategy that uses both neural nets as trading rules and specify that it trade when one of the two nets is true. The advantage is that you’re trading with two specialized neural nets rather than an average one.
II. Granny turns 218 on June 14, 2012, and you get the presents!
Granny wants to celebrate being so well preserved for her age, so we’re offering a 20% discount on Trader add-ons, Trader upgrades to Power User versions, and ChaosHunter or ChaosHunter Trader purchases until June 30, 2012. Visit www.NeuroShell.com or www.ChaosHunter.com. The online order forms will reflect these granny price savings.
III. Help us help you
Because summer is vacation time, we are occasionally short staffed. If you send us a technical support question, include your product serial number so we don’t have to look it up before sending a reply. If you send a Trader chart, be sure to save it with data (there’s a check box on the save screen for this). If you created a Trader chart that uses a ChaosHunter model, send the ChaosHunter .md (model) file and .work (work file) along with the Trader chart. We need the same ChaosHunter files if you have a question on that product. If you built your own custom .DLL for an indicator on a Trader chart, include that as well. The result will be a faster response.
IV. New credit card system for orders
If you’ve recently placed an order with us online, you may have noticed that we have switched to Authorize.net for credit card processing. If you have a problem with the new order system, let us know so that we can make the order process run as smoothly as possible.
V. Summer hours
Beginning June 18, Ward Systems Group summer office hours will be Monday through Thursday, 9 a.m. to 4:30 p.m. eastern daylight savings time. On Fridays, the office will be open from 9 a.m. to 4:00 p.m.
VI. One way to stop this newsletter
It is really easy. Just change your E-mail address and don’t tell us.