Greetings from
NeuroDimension!
The World Leader in Neural
Network Software
This premiere issue of
the TradingSolutions newsletter announces a new version of the software and
provides you with tips and tricks to help you to trade with increased intelligence.
In this issue you’ll find:
Product Upgrade
Announcement
* TradingSolutions 1.1 Now Available
What’s News?
* Frequently Asked Questions Answered
* TradingSolutions Dot Com
Feature Spotlight
* Risk Analysis
* Using TradingSolutions for Trading
Products and Events
of Interest
* Neural 101
Note: You are receiving this newsletter because you requested to stay informed concerning information about TradingSolutions from NeuroDimension. If you would like to stop receiving these newsletters, please see the bottom of this newsletter for removal instructions.
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Product Upgrade Announcement
TradingSolutions Version
1.1 is now available from NeuroDimension. As with previous releases, Version
1.1 helps you make better trading decisions by combining traditional technical analysis
with state-of-the-art artificial intelligence technologies.
Version 1.1 enhances the usability of the initial release
and adds several helpful new features, including:
* A
new charting interface that allows you to specify multiple fields when opening
a chart
* A
facility for saving and restoring previous charts and spreadsheets
*
Improved signal analysis pages with equity curves and risk analysis
measures
*
Expanded correlation analysis settings for improved prediction
preprocessing
Upgrading to
TradingSolutions Version 1.1 is free. No additional activation codes are
required to upgrade to the new version. Simply install the upgrade and start
enjoying the new features. Users of the free evaluation version can also
upgrade to Version 1.1 and receive a new 60 days to evaluate
TradingSolutions.
For information on
upgrading to the latest version, as well as a complete list of the changes made
in this release, see http://www.tradingsolutions.com/download/updates.html
You can determine the
current version and build of your TradingSolutions installation by selecting About
TradingSolutions from the Help menu.
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What’s News?
Since the initial release of TradingSolutions, we have received many excellent questions about TradingSolutions and the benefits of neural networks in everyday trading. To answer many of these common questions, we have added a FAQ (Frequently Asked Questions) section to our website. If you are unsure about whether TradingSolutions is right for you, we encourage you to visit the new FAQ.
You can visit the FAQ directly at http://www.tradingsolutions.com/faq.html
NeuroDimension, Inc. is pleased to announce that information concerning TradingSolutions is now available at http://www.tradingsolutions.com. Our previous net address is still valid, but we are happy to now be able to greet our customers with a new “dot com” address.
If you haven’t visited the TradingSolutions website lately, here’s what you’ve been missing:
* The most recent TradingSolutions updates, including Version 1.1
* Updated Sample Performance statistics and solutions for models we use for trading
* A Solution Library with solutions and function definitions you can use in TradingSolutions
* A complete Customer Center, including interactive suggestion ranking for licensed users
* The latest information on all NeuroDimension products
Visit TradingSolutions on the web at http://www.tradingsolutions.com
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TradingSolutions Version 1.1 introduces a redesigned signal analysis section for entry/exit signals. As with the previous versions, every entry/exit signal that you create is automatically analyzed for profitability. The new signal analysis pages include easier-to-understand displays, a scalable equity curve, adjustable analysis settings, and comparisons to a user-specifiable benchmark.
Also included in the new signal analysis section is a special risk analysis page with many popular risk analysis measures. These include Sharpe Ratio, Profit Factor, and Beta (Volatility) analyses. Here is a brief overview of what you can do with the measures on this page.
Using the Sharpe Ratio, you can use a single number to assess the size of the reward versus the amount of risk from day-to-day volatility. You can also use Beta values to compare the volatility of trading the signal to a buy/hold strategy or a benchmark data series.
Using the Profit Factor, you can assess the amount of money that was lost relative to the money that was gained. You can also determine the effectiveness of your exit signals using the new Exit Efficiency rating.
Using the Maximum Draw Down values, you can determine the maximum losses that occurred during the trading of the signal. This can be important for determining the size of margins required when trading on margin accounts. You can also use a count of the Maximum Consecutive Losers to determine if the signal is prone to losing streaks.
For more information on these measures and the other new signal analysis panels, see the TradingSolutions help text for the Modify Field Dialog: Signal Analysis page.
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A common question asked by our customers is "Now that I have a set of profitable models, how do I obtain the daily buy/sell signals to trade with?" The best way to set up TradingSolutions for trading is to utilize the Display Fields. This feature allows you to display the current values of selected fields for each security in your portfolio.
Here is one approach for using display fields in active trading. Listed below is a link to a screenshot of a sample portfolio with display fields selected for active trading:
http://www.tradingsolutions.net/products/tradingportfolio.gif
The display fields in this example show the following information:
1. The current signal from the best model, which is optimized on tomorrow’s open
- This tells you whether you should you should be long or short at tomorrow’s open
2. The previous non-hold signal from the best model
- This tells you the current position you should be in if you are trading the model
3. The percentage change in the closing price from yesterday to today
4. The current closing price
5. The return on investment if the model had been traded since the beginning of the year
How can you use this information? Let's say that you have just downloaded the data for today's market activity. Assuming that you were trading all of the models in both groups displayed in this example, your only trade for tomorrow would be to exit your long position (i.e., sell) on "Paychex Inc" and enter a short position (i.e., sell short). This is easy to spot since the only time you need to make a trade is when the triangle from the first column is in the opposite direction as the triangle from the second column. Note: The arrows represent “hold” signals and are different from the triangles that represent trading activity.
The other columns are primarily informational. The third and fourth columns can be used to visually track the value and direction of the price. The fifth column can be used to verify that the model is remaining profitable over time.
Here is a high-level overview of the steps needed to set up your portfolio like the one in this example:
1. Determine the group of securities that you wish to monitor with display fields.
- If you wish to include all of the securities in the portfolio, then the group would be "My Portfolio".
2. Make sure that the name of the prediction field that you wish to display is the same for all securities.
- An optional activity in Tutorial 3, Task 4 provides helpful suggestions for doing this.
3. Add the following fields (at the group level):
- Calculation: the "Previous Position" of the prediction (Period = 1).
- Calculation: the "Percent Change in Value" for the closing price (Period = 1).
- Signal Analysis: the year-to-date return of the prediction field (% Equity).
4. Select "Modify Display Fields..." from the context menu for the group, then add the desired fields.
- In addition to the calculated fields above, the example includes the prediction and the current closing price.
The TradingSolutions online helps and tutorials cover many of the concepts used in this example. Specifically:
* Tutorial 2, Task 1 - Calculate a financial indicator
* Tutorial 3, Task 2 - Work with Groups of Data
* Tutorial 3, Task 3 - Work with Display Fields
* Tutorial 3, Task 4 - Display a Signal Analysis Field
* Managing Data with the Portfolio View, Using Display Fields
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Neural 101 is a free educational web site on trading stock and futures markets with neural networks. It includes message areas, links, trading indicators, systems and scans. The message areas include special forums on building trading systems, using neural networks, and even discussing tips, tricks, and ideas for using TradingSolutions.
NeuroDimension encourages the use of this free resource to foster discussions between TradingSolutions users. You can visit Neural 101 at http://www.neural101.com. You can go directly to the TradingSolutions message forum by selecting “Message Forums” from the top menu, then selecting “TradingSolutions” from the list of Specific Software Conferences.
Have an event or product you would like to announce? Contact us at submissions@nd.com.
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We appreciate your feedback! Please send us your comments or
suggestions concerning this newsletter, our web site, or part of the
NeuroDimension product line. Write to us at: feedback@nd.com
Have questions about TradingSolutions? Send your questions to: info@tradingsolutions.com
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