Hello, welcome to this quick overview of Autochartist's Performance Statistics.
If a cautious trader is introduced to Autochartist for the first time, he or she will invariably
ask the question: "So, does it really work?"
Many people nowadays don't have the time to first test drive an application or service
before they subscribe to it.
That is why we have introduced our own Performance Statistics straight into the application itself,
to answer the question on a continual basis - "How well
is Autochartist doing?"
The results are transparent and updated on a weekly
basis, although the numbers do not change dramatically from week to week since the performance
stats are measured over a minimum of the last 6 month
period.
I want to show you in this video where to find it, how to read and interpret the results,
and how they are calculated.
Let's start at the beginning.
In your Autochartist application, click on the Performance Statistics Tab.
You will notice that there are three columns of stats, broken
down by exchange or instrument type, for example "Forex" or NYSE or
Commodities.
So you can click on any of the buttons to draw a report that is specific to that exchange
or type of instrument, and for a particular analysis type.
I want to just quickly stand still for a second at what types of analysis we have Performance
Statistics on.
You will notice that we have separate columns for Key
Level breakouts and approaches, and one for completed Chart
patterns.
The reason why we don't have a column for Fibonacci patterns is because there is simply
no computationally efficient way to determine whether a Fibonacci
pattern has been successful.
I'm not suggesting it's not possible to code, I'm just saying we don't have the kind
of resources at our disposal to do it efficiently at this time.
Now, if I click on any of the buttons, each would bring up a report in the same format.
It would just be the underlying dataset that the report is based on that would
be different for every button.
Do take note of the very last one, which is inconspicuously named "All" and encompasses
the overall statistics of the entire dataset for whatever instruments are
available on your version of Autochartist.
The report is essentially a measurement of the number of successful patterns, broken
down in specific classes of attributes that allows the reader to spot
areas of higher or below-average performance.
The first thing I need to clarify is the definition of success.
When do we regard a pattern to have been successful?
To illustrate it visually I have taken a simple
completed pattern, and measured the pattern length from where it started to
where it was identified.
Now if you take this same length and apply it to the target level, this becomes the area
of success.
If the price goes anywhere inside this green block, we consider the pattern to have been
successful.
So the report contains some basic information in case you want to print it out for your
own records, so you'll know what you're looking at.
This particular report is for Forex, for the period 28 Nov to 23 May - that is the past
six months, and the organisation field is just a reference
to your broker through whom you have access to Autochartist.
The big green numbers are the total number of patterns
that were evaluated, and the number of patterns that were successful.
And that is expressed below as a percentage.
Then the rest of the report is summarized in the Table of Contents and each attribute
by which performance is broken down is listed here.
It's an HTML report so you can click on it as a hyperlink.
Let's take Patterns for example.
From this we can quickly see that Head and Shoulders
and Inverse Head and Shoulders are great performers, while Falling
Wedges have not done so well for Forex.
Note that we deliberately included the number of patterns in each sample
set so that you can evaluate the significance of each percentage.
If you look at double tops and bottoms, the 100% is
a score of three out of three, and the 50% is 1 out of 2 - neither of these can be regarded
with much confidence, really.
Contrast that with 52 out of 61, which is a much more credible score of 85%.
The Symbols we've included are the ones with the highest number of successful patterns,
so it's the top 50 or so, sorted by this column.
Lower down the report we see some two-dimensional breakdowns, putting together for example Patterns
and Intervals.
From this we see that for Channel Downs, we have more success on end-of-day intervals
than shorter intervals.
These two-dimensional breakdowns do not include the total pattern counts, mainly to keep the
information readable.
All the other breakdowns in the report are just different variations on these two themes,
so now you should be able to make sense of it on your own.
We urge you to use these statistics cautiously and wisely, not to jump to any conclusions
that contain any expectations for easy money.
You should be aware of the risks involved, and view these stats as an academic
breakdown of past achievements.
It cannot reliably predict future outcomes.
I hope this has been a useful video, thanks for watching it and as always, best of luck
with your trading!