The prototype is built, though it’s rough. The main question is which metric to focus on first. It’s important to prioritize long-term strategy, starting with TAGR max DD percent to grow without major risk. Profit factor is also crucial; anything above 1. 5 is good, and over 2 is even better. The RETDD ratio measures risk versus reward and serves as a stress test for the strategy. Open DD percent is essential to monitor, as it can lead to anxiety if too high. Stability and a smooth equity curve are critical for live trading, as choppy curves can be stressful. Ranking the metrics, they decide on CAGR max DD percent, profit factor, RETDD ratio, open DD percent, stability, win-loss ratio, and fitness, while ensuring to analyze both IS and OOS stages. Tomorrow will involve refining and testing strategies.
Key Insights from the Discussion:
- CAGR/Max DD% – Long-term growth vs. risk is the top priority.
- Profit Factor – A reliable indicator of profitability.
- Ret/DD Ratio – Evaluates the balance between returns and drawdowns.
- Open DD% – A practical measure of risk tolerance during trades.
- Stability – Ensures a consistent and stress-free equity curve.
- Win/Loss Ratio – Useful but secondary to profitability metrics.
