Rank: Member
Groups: Registered, Registered Users Joined: 8/29/2005(UTC) Posts: 26 Location: South Africa
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Hi there im not sure where to post this but ill just put it here.
What is the Slippage for in the System tester?
Or what is its function?
thanks
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Rank: Advanced Member
Groups: Registered, Registered Users, Subscribers Joined: 9/8/2004(UTC) Posts: 2,266
Was thanked: 1 time(s) in 1 post(s)
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Slippage is the difference between the price at which time you placed your order and the price it was actually filled at ...
For example I set an alert to buy at 10 dollars, well by the time my command/order was filled the price went up to 10 dollars and 5 cents.
Which I guess could be considered lie an unexpected loss. In any case the system tester allows you to test for such situations ...
I usually recommand not to use this option, however this does not mean that slippage does not have be though of ...
Patrick :mrgreen:
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Rank: Member
Groups: Registered, Registered Users Joined: 8/29/2005(UTC) Posts: 26 Location: South Africa
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what i am noticing in the tester is that it kinda buys and holds the shares which in turn does not give you the same return as if you were buying and sell as an active trader... am i seeing this right or not
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Rank: Advanced Member
Groups: Registered, Registered Users, Subscribers Joined: 9/8/2004(UTC) Posts: 2,266
Was thanked: 1 time(s) in 1 post(s)
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Noel, I'm not sure I understood what you meant ... do you mind elaborating your though?
Patrick :mrgreen:
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Rank: Member
Groups: Registered, Registered Users Joined: 8/29/2005(UTC) Posts: 26 Location: South Africa
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Sorry I was slightly rushed when I posted that...
As an active trader we all understand that you will try to buy low and sell high... but by being and end of day trader you may not purchase and sell consistently every day....
From what I have noticed in the Metastock System tester there is a purchase made on every day and the shares are held for the entire period stipulated by the user... but I don’t notice the shares being sold until the end...
If what I am noticing is correct then the user is not getting the correct cash balance at the end of the test as if he was an active trader. This is due to the fact that when you purchase and then sell, your capital would then increase or decrease depending on the success of your trade which would then intern affect the amount of shares purchased on the next trade... Were as if the user was just purchasing more shares and holding then till the end the return would be far less…
The result that I am trying to achieve is this… I am to retrieve a report stipulating that I have purchased shares on a specific date and then sold those shares once the market turned down and then purchased again with the new cash balance once the market has turned upwards, and to continue doing this for a specific period of time.
I hope this is more helpful to you...
Thanks
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Rank: Advanced Member
Groups: Registered, Registered Users, Subscribers Joined: 9/8/2004(UTC) Posts: 2,266
Was thanked: 1 time(s) in 1 post(s)
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That's the difference between a points only test and an equity test. A points only test will assume you buy just one share evertime, the equity test will buy as many shares as you have told it to in the options and the more money you have the more share it will buy ...
Patrick :mrgreen:
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