Visit TradingSolutions.com | Download Evaluation Volume 5, No.8 This is a TradingSolutions Newsletter, which you are receiving because you requested to stay informed about new developments at NeuroDimension. You can also access current and past issues of TradingSolutions Newsletters online. TradingSolutions Tip Box: Getting Back to the Basics With so many features and options in TradingSolutions, it is easy to get lost in the glitz and glamour of things. So we've devoted this TradingSolutions Tip Box to "Getting Back to the Basics". What is the Optimal Signal? The Optimal Signal is an entry/exit signal that is generated by looking at future prices to determine the most profitable current position. In addition to other information, it takes three parameters - the number of bars to look into the future, the minimum profit required for a trade to be considered worthwhile and the maximum drawdown that you are willing to take to meet your minimum profit. At a basic level, this means that if the minimum profit can be achieved within the specified number of days, an entry signal will be generated. How is this useful? Visually, it can be used to highlight places in a chart where profitable trades could have been made. More importantly, it can also be fed into a neural network as an example of what a profitable signal should look like. In other words, it can be used as the "desired output" when training a neural network. A good general rule for setting these three parameters is that the more signals or overall profit you generate, the harder the signal may be to model. To watch a video on "What is an Optimal Signal" please visit the TradingSolutions Video Help page. What are Trading Styles? A Trading Style combines the individual settings of investment, commission, and trading value fields into one named object. For example, if you typically trade $10,000, pay $5 commissions, and only want to make Long trades, you could wrap all of these settings into one thing called "My Trading Style". Then, whenever you want to analyze or optimize signals in TradingSolutions for your specific style of trading, simply select "My Trading Style" wherever those settings are needed. Trading Styles were recently enhanced in version 4.0 of TradingSolutions to include optimizable stop loss, profit taking, limit entries and stop length rules. These settings can be genetically optimized based on "Fitness Values" such as: Profits Sharpe Ratio (avoiding volatility) Sortino Ratio (avoiding losses) Calmar Ratio (avoiding large losses) Trade Expectancy Score or even the old fitness settings of TradingSolutions v2.1. These settings allow you to specify what values are important to you when a signal is being optimized. By default, signals are optimized for the Sharpe Ratio. However, you can now specify any combination of other characteristics as being important. Each of these features in TradingSolutions can and will play a vital role in your model development process. Do not discount your own trading history and knowledge when it comes to the choices you make during the modeling process. Want to view more TradingSolutions Tip Box's? Simply click the "More Info" button below!