If you do this in trading, you’re wasting your time

I have to admit, I used to be one of those traders who worked for months on a single trading strategy.

And I tried hard to make it “perfect”.

And then, when I launched it….. Boooom. It often didn’t work in live trading.

I think many traders relate to this. The neverending effort to develop at least one really good strategy. The ever-present doubts if the strategy is really a good one. And often with the disappointment once the strategy is launched.

But here is a bizarre truth I had to learn the hard way:

The ultimate edge is NOT in the strategy.

Let me repeat that:

The ultimate edge is NOT in the trading strategy.

It is in the ROBUSTNESS PROCEDURE.

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The only measurement of a potentially viable trading strategy is if tough robustness testing procedures say so. It’s not the time you spend building your trading strategy. It’s not its simplicity or complexity. It’s not even the “rationale” behind the trading strategy.

The only thing that really matters is the outcome of the robustness procedure (which needs to be extraordinarily tough, basic tests aren’t enough any more).

This was a HUGE paradigm shift for me.

But once I went through this crucial “aha” moment, instead of looking for an edge in trading strategies, I started looking for an edge in the robustness testing procedures.

And it changed everything.

Because if THIS robustness procedure works, then it alone will take care of the strategy-edge (by clearly and quantifiably finding which of the many strategy candidates is the one with an edge).

It’s simple. It’s logical.

Yet, it often takes traders too much time to fully realize and embrace this trading truth. I think we all become too infected with the many cliches and “false truths” we keep seeing in trading books and forums (especially at the beginning of our trading journey). But don’t forget – the vast majority of traders are NOT making money, at least on a consistent basis. So it’s always wise to question as many of these “false truths” as possible. Start thinking about the “next-level”, what’s beyond these “false truths”.

Today, I spend very little time with strategy building. The whole strategy building process is fully automated (and based on my breakout model – you can find more in this free online workshop). But a lot of time is constantly put into robustness testing. That’s where my real edge is.

My advice is – don’t waste time doing things that are unnecessary.

Keep your focus on where it is truly required.

Happy robustness testing.

Tomas

P.S.
I believe that extraordinary robustness testing procedures are what makes me different to other traders. It’s also the main and absolutely essential difference between my Breakout Masterclass (where I cover the exact robustness procedures we use) and all the other “general” solutions. That’s also why the masterclass is bringing great results to many traders – if you haven’t watched it yet, here is the latest video success story.